Land and Environment Court New South Wales Medium Neutral Citation: Australian Coal Alliance Incorporated v Wyong Coal Pty Ltd [2019] NSWLEC 31 Hearing dates: 12 to 14 November 2018 Date of orders: 22 March 2019 Decision date: 22 March 2019 Jurisdiction: Class 4 Before: Moore J Decision: (1) The summons is dismissed; (2) The hearing listed for 4 April is vacated; and (3) Costs are reserved. Catchwords: JUDICIAL REVIEW - development consent issued for Wallarah 2 Coal Project - development consent issued by Planning Assessment Commission (PAC) Panel - Applicant challenges the validity of development consent on 10 pleaded grounds JUDICIAL REVIEW - Grounds 1 to 3 together - whether consent invalid by reason of failure to consider downstream greenhouse gas emissions - whether consent invalid by reason of failure to consider cl 14(2) of the State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 - whether consent invalid by reason of failure to consider principles of ecologically sustainable development - adequacy of PAC reasons concerning greenhouse gas emissions - adequacy of PAC consideration of ecologically sustainable development concerning greenhouse gas emissions - PAC's Determination Report discloses proper consideration of downstream greenhouse gas emissions - no obligation on the PAC to impose conditions on the project to address downstream greenhouse gas emissions - no failure to give adequate consideration to ecologically sustainable development - Grounds 1 to 3 rejected JUDICIAL REVIEW - alleged failure to consider the impacts of a future Central Coast water supply pipeline (the pipeline) - necessity for the pipeline would arise to provide compensatory water to the Central Coast water supply only after mining progresses to Longwall 6N and beyond - development consent granted by the PAC does not approve mining of Longwall 6N and beyond - route of the pipeline (if required) not certain, although two options identified over land owned by the mine or by public authorities - other potential pipeline routes possible over private land but not identified - not possible to identify with any precision any pipeline route capable of being assessed due to the uncertainty of either the necessity for such a pipeline or the location of a preferred route - separate future application required to be made for a pipeline if mining is proposed to continue into Longwall 6N and beyond - condition valid - Ground 4 rejected JUDICIAL REVIEW - failure to consider flood impacts - ground pleaded on four bases, two of which were abandoned - alleged failure to consider risks to the livelihoods of private property owners or of such owners being forced to sell their properties - degree of particularity to which the PAC was required to assess issues - matters remaining pressed of too greater degree of particularity to be considered beyond the extent to which the PAC addressed flooding impacts - Ground 5 rejected JUDICIAL REVIEW - error of fact in relation to flooding impacts - PAC comment that development proponent had agreed to acquire flood-affected properties where remediation or amelioration was not possible - PAC misled by assertion to this effect in departmental project assessment report - flooding impacts condition of consent addresses basis for landholders to seek compensation for flooding impacts but does not impose any requirement concerning property acquisition - error of fact did not mandate the PAC to address the erroneous finding in the flooding impacts condition of consent - flooding impacts condition of consent delegates to the Secretary resolution of any issues which might arise concerning flooding impact compensation - flooding impact compensation issues will arise to be considered on the particular facts and circumstances of any specific compensation claim pursuant to the condition - no uncertainty invalidating the condition as a consequence - Ground 6 rejected JUDICIAL REVIEW - Grounds 7 and 8 not pressed JUDICIAL REVIEW - alleged failure to consider the risk to private water supplies - two elements pleaded in support of the ground abandoned - alleged failure by the PAC to consider the two bases remained pressed - allegation that consideration of the matters had been impermissibly deferred to determination by the Secretary - PAC did consider the complained of matters - condition sets out the framework for affected landholders seeking to claim compensation - flooding impact compensation issues will arise to be considered on the particular facts and circumstances of any specific compensation claim pursuant to the condition - no uncertainty invalidating the condition as a consequence - Ground 9 rejected JUDICIAL REVIEW - alleged invalidity of water supply compensation condition - pleading that the condition impermissibly constrained landowners rights to compensation pursuant to other statutory entitlements not pressed - allegation of absence of power to impose a water supply compensation condition - pleading of Wednesbury unreasonableness of compensation condition - consideration of power to impose condition - power existed to impose condition - no submissions made in support of Wednesbury "unreasonableness" assertion - condition said not to relate reasonably to the development (second Newbury test) - condition reasonably relates to the development - Ground 10 rejected Legislation Cited: Associations Incorporation Act 2009 Environmental Planning and Assessment Act 1979 State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007, cl 14 Supreme Court Act 1970, s 69 Uniform Civil Procedure Rules 2005, r 6.24 Cases Cited: Al Maha Pty Ltd v Huajun Investments Pty Ltd [2018] NSWCA 245 Anderson v Director General of the Department of Environmental and Climate Change & Anor (2008) 163 LGERA 400; [2008] NSWCA 337 Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321; [1990] HCA 33 Brimbella Pty Ltd v Mosman Municipal Council (1985) 79 LGERA 367 Darkinjung Local Aboriginal Land Council v Wyong Coal Pty (No 2) [2014] NSWLEC 71 Gloucester Resources Ltd v the Minister for Planning [2019] NSWLEC 7 Hoxton Park Residents Action Group Inc v Liverpool City Council [2010] NSWLEC 242 Hoxton Park Residents Action Group Inc v Liverpool City Council (2011) 81 NSWLR 638; [2011] NSWCA 349 Hurstville City Council v Renaldo Plus 3 Pty Ltd [2006] NSWCA 248 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 Kostas v HIA Insurance Services Pty Ltd (2010) 241 CLR 390; [2010] HCA 32 Manly Council v Hortis (2001) 113 LGERA 321; [2001] NSWCA 81 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 Minister for Immigration & Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 Minister for Planning v Walker (2008) 161 LGERA 423; [2008] NSWCA 224 Moorebank Recyclers Pty Ltd v Benedict Industries [2015] NSWLEC 40 Newbury District Council v Secretary of State for the Environment [1981] AAC 578 Parramatta City Council v Hale (1982) 47 LGERA 319 Rivers SOS Inc v Minister for Planning (2010) 178 LGERA 347; [2009] NSWLEC 213 The Queen v Australian Broadcasting Tribunal; ex parte Hardiman (1980) 144 CLR 13; [1980] HCA 13 Ulan Coal Mines Limited v Minister for Planning and Moolarben Coal Mines Pty Limited (2008) 160 LGERA 20; [2008] NSWLEC 185 Walsh v Parramatta City Council [2007] NSWLEC 255 Weal v Bathurst City Council (2000) 111 LGERA 181; [2000] NSWCA 88 Western Australian Planning Commission v Temwood Holdings Ply Ltd (2004) 221 CLR 30; [2004] HCA 63 Wollar Progress Association Inc v Wilpinjong Coal Pty Ltd [2018] NSWLEC 92 Wollongong Coal Pty Ltd v Minister for Planning and Environment [2016] NSWLEC 154 Category: Principal judgment Parties: Australian Coal Alliance Incorporated (Applicant) Wyong Coal Pty Ltd (First Respondent) Minister for Planning (Second Respondent) Kores Australia Pty Ltd (Third Respondent) Sojitz Coal Resources Pty Ltd (Fourth Respondent) Kyungdong Australia Pty Ltd (Fifth Respondent) SK Networks Resources Australia (Wyong) Pty Ltd (Sixth Respondent) SK Networks Resources Pty Ltd (Seventh Respondent) Representation: Counsel: Mr C Leggat SC/Ms J Walker, barrister (Applicant) Mr R Lancaster SC/Mr D Hume, barrister (First Respondent) Mr A Shearer and Ms R Mansted, barristers (Second Respondent) Submitting appearance (Third, Fourth, Fifth, Sixth and Seventh Respondents) Solicitors: EDO NSW (Applicant) Minter Ellison (First Respondent) Department of Planning and Environment (Second Respondent) File Number(s): 120210 of 2018 Publication restriction: No TABLE OF CONTENTS Introduction The parties The relief sought Legislative citation The outcome of the proceedings The agreed chronology The approach to be taken to the PAC's Determination Report An inference against the PAC? General comments - the greenhouse gas emission grounds (Grounds 1-3) Introduction Describing categories of greenhouse gas emissions The decision in Gloucester Resources Ltd v the Minister for Planning The greenhouse gas emission grounds - Grounds 1, 2 and 3 Introduction Ground 1 Ground 2 Ground 3 Clause 14(2) of the Mining SEPP The documentary material relevant to Grounds 1, 2 and 3 Introduction Material referenced in the Determination Report as considered by the PAC Panel The First Respondent's summary of relevant information The Project's Environmental Impact Statement The Department's Preliminary Assessment Report The First PAC Review Report The Departmental Addendum Report The Second PAC Review Report The PAC's Determination Report Some preliminary matters concerning Grounds 1, 2 and 3 The composition of the PAC Panel Wollar Progress Association Inc v Wilpinjong Coal Pty Ltd [2018] NSWLEC 92 Reliance on the departmental advice The need to avoid lapsing into merit review under the guise of judicial review The submissions on Grounds 1 and 2 The Applicant's position The Applicant's broad position in reply Consideration of the "lens mistake" Introduction The content of the materials considered by the PAC Absence of specific referencing of cl 14(2) of the Mining SEPP Consideration of the "location mistake" The matters actually pleaded in Ground 1 The relevant paragraph of the PAC's Determination Report The essence of the "location mistake" Consideration of the "location mistake" Ground 3 Introduction The Departmental Addendum Report The First Respondent's response to Ground 3 on the facts The Minister's submissions on the factual matters relating to Ground 3 Conclusion about Ground 3 on the facts The First Respondent's response on the requirements of the EP&A Act Conclusion on Ground 3 Ground 4 Introduction The necessity for water supply compensation The position concerning possible pipeline routes The PAC's consideration The water supply compensation conditions The primary condition The secondary conditions The Applicant's position The position of the active respondents The Minister's position Consideration Ground 5 Introduction Was there a legal inadequacy? Introduction Consideration of the asserted legal impediment Was there a factual inadequacy? Introduction The flooding conditions Conclusion on Ground 5 Ground 6 Introduction The relevant background The complained of paragraph The PAC's flooding compensation condition The Applicant's position The First Respondent's position The PAC's exercise of jurisdiction relevant to Ground 6 Grounds 7 and 8 Considering Grounds 9 and 10 together Introduction 1 Ground 9 Introduction The Water Supply Condition The Applicant's written submissions' position on Ground 9 The Applicant's reply position on Ground 9 Consideration Ground 10 Introduction The Water Supply Condition The Applicant's position The Applicant's reply position The First Respondent's written submissions The First Respondent's oral submissions The Minister's position The Minister's oral submissions Consideration Orders Judgment Introduction 1. These Class 4 judicial review proceedings were commenced on 16 April 2018 by the Australian Coal Alliance Incorporated (the Applicant) seeking judicial review of the Planning and Assessment Commission's (the PAC) determination of the Wallarah 2 Coal Project (the project). 2. The PAC assessed and determined State Significant Development Application No SSD 4974 (the development application), which sought approval for the project, as delegate for the Minister for Planning (the Minister). The PAC granted consent to the development application on 16 January 2018 (the consent). 3. The Applicant contends that the consent is invalid and of no effect and seeks an order restraining each of Wyong Coal Pty Ltd (the First Respondent), Kores Australia Pty Ltd (the Third Respondent), Sojitz Coal Resources Pty Ltd (the Fourth Respondent), Kyungdong Australia Pty Ltd (the Fifth Respondent), SK Networks Resources Australia (Wyong) Pty Ltd (the Sixth Respondent) and SK Networks Resources Pty Ltd (the Seventh Respondent) from undertaking any development in reliance on the consent. 4. The Applicant raises 10 grounds in its Second Further Amended Summons (Second FAS) upon which it says the consent is invalid and of no effect. In short form, these grounds can be summarised as: 1. A failure to consider downstream emissions; 2. A failure to consider cl 14(2) of the State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 (the Mining SEPP); 3. A failure to consider principles of ecologically sustainable development (ESD); 4. A failure to consider the impacts of constructing a pipeline to discharge treated minewater to the Central Coast Water Supply System (the CCWSS pipeline); 5. A failure to consider flood impacts; 6. An error of fact in relation to flood impacts; 7. A misconstruction of the flood compensation condition of the consent on the part of the PAC; 8. Invalidity of the flood compensation condition; 9. A failure to consider the risk to private water supplies; and 10. Invalidity of the water supply condition in the consent. 1. The details from the Applicant's Second FAS are set out at the commencement of the relevant section of this judgment. The parties 1. The Applicant is an association incorporated under the Associations Incorporation Act 2009 (NSW) with registration number Y2211018. The Applicant says it is a not-for-profit volunteer-based organisation which brings this matter on its own behalf and in the public interest. 2. The development application was lodged by the Wyong Areas Coal Joint Venture (WACJV). The First Respondent manages the project on behalf of the WACJV and is the Applicant for Mining Lease Applications 462 and 522 in respect of the project site. The First Respondent is the only one of those economically involved with the proposed mine to take an active role in the proceedings. 3. The Third Respondent is the ultimate holding company of the First Respondent and is the Applicant for Mining Lease Applications 342, 343, 346 and 350 in respect of the project site. The Third Respondent has an interest of 82.25% in the WACJV. The Fourth Respondent has an interest of 5% in the WACJV. Each of the Fifth, Sixth and Seventh Respondents has an interest of 4.25% in the WACJV. 4. Each of the Third, Fourth, Fifth, Sixth and Seventh Respondents has filed a submitting appearance in the proceedings. The relief sought 1. The substantive relief sought by the Applicant is in the following terms: In relation to State Significant Development Application No. SSD 4974 lodged by Wyong Areas Coal Joint Venture (the development application) for the Wallarah 2 Coal Project (Project) and purportedly determined by the Planning Assessment Commission (PAC) by granting consent on 16 January 2018 (the consent): (a) a declaration that the consent is invalid and of no effect; (b) an order restraining the First, Third, Fourth, Fifth, Sixth and Seventh Respondents from undertaking any development in reliance on the consent. 1. The Applicant also seeks a costs order in its favour. Legislative citation 1. The elements of the Environmental Planning and Assessment Act 1979 (NSW) (the EP&A Act) to which reference was made throughout these proceedings, and in this judgment, were cited by the numbering system applying prior to 1 March 2018 - a system now replaced in a renumbered and rearranged EP&A Act. I have not incorporated references to the renumbered provisions. The outcome of the proceedings 1. For the reasons that follow, I have determined that all grounds are without merit and the Second FAS is to be dismissed. As a consequence, it is unnecessary to consider the supplementary submissions filed for the Minister (on 21 November 2018) or the Applicant (on 28 November 2018) concerning what might have been the impact of s 102 of the EP&A Act had I upheld any of the pleaded grounds. The agreed chronology 1. The parties provided an agreed chronology (Court Book, folios 265 and 266) which is reproduced below: Date Event October 2012 Original Development Application lodged. April 2013 Environmental Impact Statement 26 April 2013 to 21 June 2013 Department placed Environmental Impact Statement on public exhibition September 2013 WACJV Response to Submissions Feb 2014 Department's Preliminary Assessment Report. April 2014 PAC held public hearings June 2014 First PAC Review Report. 12 June 2014 Decision handed down in Darkinjung Local Aboriginal Land Council v Wyong Coal Pty (No 2) [2014] NSWLEC 71 found that consent to the original DA could not be granted without the Land Council's consent. 1 July 2014 WACJV Response to First PAC Review Report 7 July 2016 Amended Development Application lodged. 22 July to 5 September 2016 Amended Development Application placed on public exhibition. 4 November 2016 WACJV response to Submissions on the amended Development Application. 22 December 2016 Department sought further information from the WACJV 16 January 2017 WACJV submitted information in response to Department's request February 2017 Department's Addendum Report. 5 April 2017 PAC held public hearings 19 May 2017 Second PAC Review Report. 27 June 2017 WACJV response to the Second PAC Review Report. 30 June 2017 Department requested additional information from WACJV 6 July 2017 Department met with Central Coast Council representatives 13 July 2017 WACJV provided a response to Department's information request September 2017 Department's Residual Matters Report. 20 October 2017 PAC receives a briefing from the Department 2 November 2017 PAC meets with the Central Coast Council; PAC meets with WACJV; PAC attends a site visit 3 November 2017 PAC holds a public meeting at the Wyong Golf Club; 21 speakers are heard 11 November 2017 PAC receives expert advice on subsidence impacts 23 November 2017 WACJV Response to PAC Queries 16 January 2018 PAC Determination Report; consent granted subject to conditions. The approach to be taken to the PAC's Determination Report 1. In Minister for Immigration & Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 at 272, the plurality of the High Court endorsed the proposition that, in undertaking a judicial review of an administrative decision-maker's decision: The reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error. 1. The plurality also said that, in the context of the propositions it had endorsed (including that reproduced immediately above): … the reality that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed. 1. As a general position, these propositions, by themselves, could be regarded as providing a complete answer to the Applicant's complaints about insufficiency of explanation in the PAC's Determination Report. I accept that they cannot act as an answer to any complaint of absence of reasons where reasons are to be regarded as necessary. 2. During the opening of the First Respondent's submissions, Mr Lancaster SC, on behalf of the First Respondent, said (Transcript, 12 November 2018, page 25, lines 30 to 49): LANCASTER: … Your Honour, the case for the applicant evidently springs, in our submission, from a fundamental disagreement with, and disappointment about, the merits of the decision of the PAC to approve coal mining subject to conditions in this instance. We submit that that disagreement has led the applicant to commit a series of errors in its own analysis of the decision and they're errors that the authorities have consistently warned against in proceedings for judicial review. The first of those is to take an unfairly demanding approach to the reasons for decision. Here, of course, there was no statutory or other obligation on the PAC to provide a statement of reasons. Nevertheless, it provided a determination report which is evidently its summary and only a summary of the vast amount of information and analysis that have been undertaken over many years that supported its final determination. And when I say "unfairly demanding approach to the reasons" that, of course, is a reference on my part to the line of cases that warns against requires that Courts not proceed on the basis of an approach of looking for error in the reasons or of asking questions about disconnections between sentence A and sentence X and suggesting that there must be an error somewhere in between. 1. In Wollongong Coal Pty Ltd v Minister for Planning and Environment [2016] NSWLEC 154 at [16] to [18], I explained why I considered, by analogy, the oft-cited passage from the judgment of Kirby P in Brimbella Pty Ltd v Mosman Municipal Council (1985) 79 LGERA 367 concerning the decisions by Commissioners of this Court was equally applicable to decisions made by panels of the PAC. It is convenient to repeat what the President said, at 368: Here, the parliament has specifically envisaged a tribunal which included lay assessors. It would be quite wrong, in my opinion, for this Court to examine their decisions as if they were written by a lawyer. I am not, by these comments, suggesting double standards; simply that the Court should take into proper account the composition of the tribunal, as it has been created by the parliament. 1. The common descriptor described for considering such decisions is that they are not to be analysed with a "fine-tooth comb". I am satisfied that this is the appropriate approach to take to this Determination Report concerning the approval of this coal mine. An inference against the PAC? 1. The Applicant proposes that, because the PAC has not provided any explanatory material concerning its determination for the purposes of these proceedings nor sought to be heard to defend its position, I should draw a Jones v Dunkel inference (Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8) that any such material would not be of assistance to support the PAC's determination. There are a number of significant difficulties with this proposition. 2. The first is that the PAC is not a party to these proceedings, and the Applicant has not sought to have them joined as a respondent to the proceedings. It is difficult to see how there can be an inference drawn, of the nature proposed by the Applicant, in these circumstances as there is no obligation on the PAC to participate, nor is there any basis advanced as to why either the Mining Respondents or the Minister should be seen to have some inferred obligation to seek to call the PAC to give evidence in their case. 3. The second difficulty would arise if the Applicant had sought to join the PAC as a party to the proceedings. For the purposes of this discussion, it is not necessary to consider whether or not the PAC might have sought to resist such joinder by submitting that neither of the tests in r 6.24 of the Uniform Civil Procedure Rules 2005 applied to necessitate such joinder. It is, however, reasonable to assume that, as was the position with this Court when it was a party to proceedings brought pursuant to s 69 of the Supreme Court Act 1970 (the general supervisory jurisdiction of the Supreme Court) (see Al Maha Pty Ltd v Huajun Investments Pty Ltd [2018] NSWCA 245), any appearance on behalf of the PAC would have been a submitting appearance, save as to costs. 4. Third, in the circumstances where the PAC might become a party, it would not be appropriate for it to seek to be an active party in the proceedings for the reasons discussed by the High Court in The Queen v Australian Broadcasting Tribunal ex parte Hardiman (1980) 144 CLR 13; [1980] HCA 13. 5. It is appropriate to note that the role of the PAC, with respect to this mining project, has been to act as the consent authority that made the determination to grant the project development consent, subject to conditions. Whilst the PAC had, earlier, undertaken two reviews of the project, the processes undertaken in each of those instances were functionally different from that challenged in these proceedings. In those earlier review processes, the PAC was acting in an advisory capacity and not in a determinative one. However, despite that distinction, the PAC, in its determinative role currently under challenge, was entitled to (and, indeed, could reasonably be expected to be mandated to) have regard, amongst the material necessary for its consideration of whether to grant development consent to the project, to the review reports which had been prepared by the PAC when undertaking its advisory function. 6. In this fashion, it is appropriate to understand that the PAC performs a primary consent authority role, a role which is not amenable to merit appeal in circumstances where the PAC has held a public hearing into the proposed development for which it has been invested with the approval role. In this instance, there is no dispute that the PAC has held a public hearing in the necessary fashion to act to exclude any merit review of its determination. In these circumstances, as is here the case, the only avenue to question the PAC's determination is by judicial review, one which, of necessity, must be founded on the assertion that defects in the PAC's process miscarried in one or more respects in a sufficiently material fashion to vitiate the PAC's determination. 7. In these circumstances, the PAC neither could, nor should, have been a party to these proceedings. 8. It is clearly inappropriate to suggest that any adverse inference of the nature proposed on behalf of the Applicant should be drawn against either the Mining Respondents or the Minister as a consequence of the fact that there has been no active evidentiary or other participation by the PAC in these proceedings. General comments - the greenhouse gas emission grounds (Grounds 1-3) Introduction 1. The Applicant has pleaded three separate grounds concerning what it submitted were failures of the PAC to address, adequately, greenhouse gas emissions. The general approach adopted by the Applicant to these grounds is discussed later. The specific grounds themselves, as pleaded in the Second FAS, are also set out at the commencement of my consideration of those grounds. 2. However, in the context of a broad introduction to my consideration of these grounds, several preliminary observations are appropriate. 3. First, as can be observed from the grounds pleaded, the Mining SEPP was engaged for the purposes of the PAC's determination process. A range of matters in the Mining SEPP required to be considered. The Applicant's complaint concerning the PAC's processes relates only to whether or not the PAC discharged the obligations placed on by cl 14 of the Mining SEPP. It is sufficient, for these introductory purposes, merely to reproduce the terms of this clause. It will, however, be necessary to return to its terms (including how cl 14(1)(c) and cl 14(2) interact). Clause 14 of the Mining SEPP is in the following terms: 14 Natural resource management and environmental management (1) Before granting consent for development for the purposes of mining, petroleum production or extractive industry, the consent authority must consider whether or not the consent should be issued subject to conditions aimed at ensuring that the development is undertaken in an environmentally responsible manner, including conditions to ensure the following: (a) that impacts on significant water resources, including surface and groundwater resources, are avoided, or are minimised to the greatest extent practicable, (b) that impacts on threatened species and biodiversity, are avoided, or are minimised to the greatest extent practicable, (c) that greenhouse gas emissions are minimised to the greatest extent practicable. (2) Without limiting subclause (1), in determining a development application for development for the purposes of mining, petroleum production or extractive industry, the consent authority must consider an assessment of the greenhouse gas emissions (including downstream emissions) of the development, and must do so having regard to any applicable State or national policies, programs or guidelines concerning greenhouse gas emissions. (3) … Describing categories of greenhouse gas emissions 1. As can be seen in cl 14(2) of the Mining SEPP reproduced above, the obligation placed on the PAC to consider an assessment of greenhouse gas emissions expressly requires that the PAC consider downstream emissions. In this context, greenhouse gas emissions are conventionally described as being Scope 1, Scope 2 or Scope 3 emissions. It is uncontroversial in these proceedings that what are described in cl 14(2) of the Mining SEPP as "downstream emissions" are those emissions that fall within Scope 3 of the Emissions Classification System. The decision in Gloucester Resources Ltd v the Minister for Planning 1. Since reserving my decision in these Class 4 proceedings, Preston CJ has delivered (on 8 February 2019) his decision in Gloucester Resources Ltd v The Minister for Planning [2019] NSWLEC 7. His Honour determined that the State Significant Development Application for the amended Rocky Hill Coal Project was to be refused. Those proceedings were merit review proceedings in Class 1 of the Court's jurisdictions. 2. His Honour rejected that proposed open-cut coal mine on two broad, but entirely separate, bases. The first, not a matter potentially arising for consideration in these proceedings, was based on his Honour's findings as to the negative social and other local impacts that that mine proposal would have had on the community of Gloucester. Second, his Honour also rejected the proposed mine on the basis of what would be its future greenhouse gas emission impacts. His Honour concluded that these impacts outweighed the benefits which might be obtained from approving the proposed mine. 3. At [699], his Honour summarised the bases upon which he had reached his conclusion to reject the proposed mine, saying: 699 In short, an open cut coal mine in this part of the Gloucester valley would be in the wrong place at the wrong time. Wrong place because an open cut coal mine in this scenic and cultural landscape, proximate to many people's homes and farms, will cause significant planning, amenity, visual and social impacts. Wrong time because the GHG emissions of the coal mine and its coal product will increase global total concentrations of GHGs at a time when what is now urgently needed, in order to meet generally agreed climate targets, is a rapid and deep decrease in GHG emissions. These dire consequences should be avoided. The Project should be refused. 1. It is important that I note that these proceedings are entirely different in nature to those leading to his Honour's conclusion set out above. These are Class 4 judicial review proceedings in which I am examining the decision-making process for (and not the decision merits of) the consideration by the PAC of this proposed coal mine and its determination to approve it. 2. The greenhouse gas emission merit issues, which led to the conclusion by the PAC that these did not warrant refusal of this project, are not ones which I am considering. To do so would be a fundamental error in my exercise of the Class 4 judicial review jurisdiction of this Court. 3. That the PAC, in this case, and Preston CJ in the Gloucester Resources case, reached differing conclusions on these merit matters does not arise as a factor for my consideration in these proceedings. The Chief Judge determined the Gloucester Resources case on the basis of the evidence presented to him, whilst the PAC dealt with this proposed mine on the material presented to it. 4. Each case turned, in a merit assessment sense, on the facts and circumstances of the particular application being considered and the evidence brought concerning it. That minds may differ on the conclusions to be reached is a not an unusual circumstance, but one that plays no part in my consideration in these proceedings. 5. I should add that the Chief Judge's reasoning for the "wrong time" basis for refusal of the Gloucester Resources proposed mine were set out in 134 lucidly explained paragraphs (between [422] and [556]) of his lengthy judgment. 6. Although I have concluded that there was no error in the PAC's processes, that conclusion does not constitute any endorsement, on a merit basis, of the conclusion that that body reached concerning greenhouse gas emissions. The greenhouse gas emission grounds - Grounds 1, 2 and 3 Introduction 1. In light of the way the Applicant's oral submissions addressed the greenhouse gas grounds (Grounds 1, 2 and 3), it is appropriate to set out, first, the terms of all three of these grounds as pleaded prior to setting out again the terms of cl 14 of the Mining SEPP, as it is the primary foundation of complaint in these three grounds (although, it is to be noted, the objects of the EP&A Act and the matters engaged by s 79C of the Act also require some limited consideration in addressing these grounds). Ground 1 1. The Applicant's Ground 1 was pleaded in the following terms: Ground 1 - failure to consider downstream emissions 5 Clause 14 of the State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007 (Mining SEPP) applied to the determination of the development application by the PAC. Particulars i. The activities the subject of the development application meet the definition of 'mining' in clause 3 of the Mining SEPP. 6 Clause 14(2) of the Mining SEPP provides that when determining a development application for development for the purposes of mining, petroleum production or extractive industry, the consent authority must consider an assessment of the greenhouse gas emissions (including downstream emissions) of the development. 7 Clause 14(2) of the Mining SEPP made the downstream greenhouse gas emissions of the project a mandatory relevant consideration to be taken into account by the PAC when determining the development application. 8 The PAC, when determining to grant the consent: a. did not consider an assessment of the downstream greenhouse gas emissions of the project; and b. did not otherwise consider the downstream greenhouse gas emissions of the project. 8A In the alternative to [6] above, cl 14(2) of the Mining SEPP requires the consent authority to consider an assessment of greenhouse gas emissions (including downstream emissions) of the development when deciding whether or not to impose conditions under cl 14(1) of the Mining SEPP to ensure that greenhouse gas emissions were minimised to the greatest extent practicable. 8B In the alternative to [7] above, cl 14(2) of the Mining SEPP made the downstream greenhouse gas emissions of the project a mandatory relevant consideration to be taken into account by the PAC when deciding whether or not to impose conditions pursuant to cl 14(1) of the Mining SEPP. 8C In the alternative to [8] above, the PAC, when determining to grant the consent subject to conditions aimed at ensuring that the greenhouse gas emissions were minimised to the greatest extent practicable: a. did not consider an assessment of the downstream greenhouse gas emissions of the project; b. did not otherwise consider the downstream greenhouse gas emissions of the project; and c. did not consider whether or not to impose conditions to limit the downstream greenhouse gas emissions of the project. Ground 2 1. The Applicant's Ground 2 was pleaded in the following terms: Ground 2 - failure to consider cl 14(2) 10 Section 79C(1)(e) of the EP&A Act applied to the determination of the development application by virtue of s 89H. 11 Pursuant to s 79C(1)(a)(i) of the EP&A Act, a consent authority, when determining a development application is required to take into consideration the provisions of any environmental planning instrument of relevance to the development. 12 Section 79C(1)(a)(i) made cl 14(2) of the Mining SEPP a mandatory relevant matter to be considered by the PAC when determining the development application. 13 The PAC, when deciding to grant the consent, did not consider cl 14(2) of the Mining SEPP. 13A In the alternative to [12]-[13] above, s 79C(1)(a)(i) made cl 14(1) of the Mining SEPP a mandatory relevant matter to be considered by the PAC when determining the development application. 13B In the alternative to [12]-[13] above, s 79C(1)(a)(i) made cl 14(2) of the Mining SEPP a mandatory relevant matter to be considered by the PAC when determining whether or not to impose conditions pursuant to cl 14(1) of the Mining SEPP to · ensure that greenhouse gas emissions were minimised to the greatest extent practicable. 13C The PAC, when deciding to impose conditions to ensure that greenhouse gas emissions were minimised to the greatest extent practicable did not consider cl 14(2) of the Mining SEPP. Ground 3 1. The Applicant's Ground 3 was pleaded in the following terms: Ground 3 - failure to consider ESD 15 Pursuant to s 79C(1)(e) of the EP&A Act, a consent authority, when determining a development application, is required to consider the public interest. 16 At the time that the consent was granted, the principles of Ecologically Sustainable Development (ESD), including the precautionary principle and the principle of intergenerational equity were so plainly an aspect of the public interest that a failure to take them into account demonstrated a failure to take into account the public interest. 17 When determining to grant consent to the development, the PAC failed to take into account the precautionary principle and the principle of intergenerational equity by failing to take into account the downstream greenhouse gas emissions of the project and the impact of those emissions on the environment and future generations. Clause 14(2) of the Mining SEPP 1. As earlier noted, the terms of cl 14 of the Mining SEPP provide the primary foundation of complaint in these three grounds. The relevant elements of the clause are reproduced below: 14 Natural resource management and environmental management (1) Before granting consent for development for the purposes of mining, petroleum production or extractive industry, the consent authority must consider whether or not the consent should be issued subject to conditions aimed at ensuring that the development is undertaken in an environmentally responsible manner, including conditions to ensure the following: (a) …, (b) …, (c) that greenhouse gas emissions are minimised to the greatest extent practicable. (2) Without limiting subclause (1), in determining a development application for development for the purposes of mining, petroleum production or extractive industry, the consent authority must consider an assessment of the greenhouse gas emissions (including downstream emissions) of the development, and must do so having regard to any applicable State or national policies, programs or guidelines concerning greenhouse gas emissions. The documentary material relevant to Grounds 1, 2 and 3 Introduction 1. Next, it is appropriate to set out what the PAC determination panel identified as the material considered by it in reaching the conclusion that conditional consent should be granted to the proposed mine. 2. It is also appropriate, both in summary and in a little detail, to identify appropriate elements of the material referenced in the PAC's Determination Report. Material referenced in the Determination Report as considered by the PAC Panel 1. The PAC's Determination Report set out (Evidence Book, folio 3831) an outline of the various meetings and the site visit that this PAC Panel undertook during its determination process. 2. The Determination Report then listed (Evidence Book, folio 3832) a range of matters under the heading "5. COMMISSION'S CONSIDERATION". These matters are listed in the following terms: In this determination, the Commission has considered carefully: • all information provided by the applicant including the additional information that was provided through the process; • the Department's preliminary, addendum and residual matters assessment reports; • additional information from the Department; • advice and recommendations from experts and government agencies; • speakers' presentations at the public hearing (and public meeting) and written submissions received by the Commission; • relevant matters for consideration specified in section 79C of the Environmental Planning and Assessment Act 1979 (EP&A Act), including: ○ relevant environmental planning instruments; ○ the Environmental Planning and Assessment Regulation 2000; ○ the likely impacts of the development on both the natural and built environments; ○ social and economic impacts in the locality; ○ the suitability of the site for the development; ○ written and verbal submissions from the public; and ○ the public interest, including the objects of the EP&A Act. The key matters considered by the Commission during this process include: 1. Strategic context. 2. Impacts on surface and groundwater 3. impacts on residents and property relating to mine induced subsidence. 4. Continued access due to proposed road closure. 5. Biodiversity 6. economic costs and benefits. 7. The precautionary principle. The Commission is satisfied with the Ddepartment's assessment of other matters including Aboriginal cultural heritage, historic heritage, cliffs and rock formations, traffic and transport, agriculture, visual impacts, contamination, management of waste, rehabilitation and the relevant environmental planning instruments, including Wyong Local Environmental Plan 2013, State Environmental Planning Policy (Mining, Petroleum Production and Extractive Industries) 2007, State Environmental Planning Policy Number 71 - Coastal Protection and State Environmental Planning Policy (Infrastructure) 2007. 1. Immediately after this list of matters dealt with by the PAC, the determination report continued, in "5.1 Strategic Context", with a section "5.1.1: Coal quality, demand in greenhouse gas emissions". This portion of the determination report was in the following terms: The Wallarah 2 coal mine proposes to extract 95 million tonnes of high-grade thermal coal over 28 years. Coal mining would be undertaken at depths of between 350m and 690m below the surface within the underground extraction area. Mining and related activities are expected to occur 24 hours a day, seven days a week. Extracted coal would undergo minimal processing on site. Product coal would be transported by rail to the port of Newcastle for export or to local domestic power stations. Demand for coal over the next 28 years and the acceptability of the greenhouse gas emissions associated with the end use of the coal are significant uncertainties for the project. Renewable energy technologies have advanced substantially since mining of this resource was first contemplated. Global agreement on climate change and the need for mitigation has also strengthened around the Paris Agreement at the United Nations Framework Convention on Climate Change at the 21st Conference of the Parties in Paris (30 November to 12 December 2015). Notwithstanding this, construction of new thermal coal power plants continues. In Southeast Asia alone, coal consumption could more than double in the period to 2040 under some estimates. Even scenarios designed to accommodate the objectives of the Paris Agreement suggest Southeast Asia's coal consumption will increase, before falling back to current levels, of around 60 GW of coal generated electricity capacity in 2040. The Powering Past Coal Alliance declaration notes that coal phase-out is needed no later than by 2030 in the OECD and EU28, and no later than 2050 in the rest of the world. Carbon capture and storage solutions also continue to be developed. The Commission acknowledges there is uncertainty in the future demand for thermal coal over the life of the proposed project. Generally, the profitability of the project is a matter for the applicant in developing and operating the mine. Nonetheless, the Commission has considered carefully the potential impacts of the mine becoming unviable, and ceasing to operate partway through the proposed 28-year Life of Mine plan. The Commission notes the potential socio-economic impacts of an unplanned early mine closure, and has also sought clarification on the environmental impacts of an unplanned mine closure. These issues are addressed further in section 5.2 and 5.6 below. 1. Critical to my consideration of Grounds 1 to 3 pressed by the Applicant, this portion of the PAC's Determination Report then continued saying: The Commission also acknowledges the greenhouse gas emissions that would be produced from any future burning of the coal extracted, whether it is consumed locally or internationally. It is noted that presently there are alternative coal sources available to the market in the event that this mine does not proceed. Consequently, the downstream use of the coal (and any emissions abatement or capture technologies deployed) will need to be considered at that location. 1. The determination report then concluded this section with a paragraph concerning emissions generated on the mine site. Although not relevant to the matters pleaded by the Applicant in Grounds 1 to 3, for completeness I include this concluding paragraph. It is in the following terms: In relation to the emissions generated on site, the Commission is satisfied that greenhouse gas emissions will be minimised as the conditions require a feasibility study for the beneficial use of methane, along with implementation of any feasible options, and the capture and flaring of methane where beneficial use is not feasible. The First Respondent's summary of relevant information 1. The First Respondent's written submissions set out, under the heading "Factual flaws in the ACA's argument", a summary of the various documentary locations where relevant greenhouse gas emissions consideration occurred in material referenced by the PAC as having been considered by it in reaching its conclusion to approve the proposed mine. The relevant portion of the First Respondent's written submissions is reproduced below: 39 The EIS included an "Air Quality and Greenhouse Gas Assessment" (EB Tab 8). At EB 1093- 1100, there was a report described as a "Greenhouse Gas Assessment". That included an assessment of scope 1, scope 2 and scope 3 emissions over 38 years (EB 1096). It also included specific detailed analyses of scope 3 emissions for diesel consumption (EB 1119), electricity (EB 1121) and transportation of product coal (EB 1125). 40 The Air Quality and Greenhouse Gas Assessment was, on any view, an assessment of the greenhouse gas emissions (including downstream emissions) of the project within the meaning of cl 14 of the Mining SEPP. This appears to be conceded: AWS [38]. 41. The EIS Main Report included a summary of the conclusions from the Air Quality and Greenhouse Gas Assessment: see EB 301. That summary included an analysis of scope 3 emissions. The EIS Main Report also identified steps the proponent was proposing to take to mitigate impacts in respect of greenhouse gases: EB 302. 42. The Department's Assessment Report addressed greenhouse gas emissions at EB 1701-1702. The Department informed the PAC that "[t]he EIS includes an assessment of greenhouse gas (GHG) emissions"" EB 1701. The Department also addressed the potential impacts from scope 3 emissions ie the burning of coal. The Department indicated that due consideration should be given to, inter alia, the "project's contribution to global warming/climate change": EB 1701. The Assessment Report also set out a summary of the estimated emissions from the project, including estimated scope 3 emissions: EB 1702. This, again, was an "assessment" of downstream emissions. 43. The Department's Assessment Report also referred to steps which WACJV was proposing to implement to mitigate greenhouse gas emissions: EB 1702. 44. The proponent's Response to Submissions also addressed greenhouse gas emissions (EB 1355- 1357) and, in particular, dealt with the principle of inter-generational equity in that context (EB 1356-1357). 45. The proponent placed before the PAC a summary of the submissions provided by stakeholders (including members of the public): see EB Tab 12. A number of those submissions related to greenhouse gas emissions from the project. 46. In its first Review Report, the PAC dealt with greenhouse gas emissions and, in particular, referred to estimated scope 3 emissions from the project: EB 1973-1974. The ACA observes that the PAC suggested in this report that it would be "helpful" for there to be comparisons between the project's scope 1, 2 and 3 emissions and total emissions in NSW, Australia and the world: AWS [23]. This observation is fatal to the ACA's argument. It shows that the PAC had carefully considered the estimate of emissions and was engaging with that issue. 47. Following the first Review Report, the proponent undertook to implement methane capture methods: EB 2144. 48. Thereafter, the proponent prepared a supplementary Air Quality and Greenhouse Gas Assessment: EB Tab 21. At EB 2345-2351, there were updated assessments of scope 3 emissions. A narrative summary of the detailed assessments is at EB 2323-2328. Again, on any view, this was an assessment of greenhouse gas emissions, including downstream emissions. 49. Greenhouse gas emissions were again addressed in WACJV's further response to submissions (EB 2566, 2614-2615, 2645, 2656-7, 2673). That response addressed, inter alia, the incremental effect which scope 1 emissions on the project would have on Australia's Kyoto commitments (EB 2614). 50. The PAC dealt with greenhouse gas emissions in its Second Review Report: EB 3054. 51. The proponent also addressed the cost of total emissions from the project (whether downstream or otherwise) in its Response to the Second PAC Report (EB 3146). Those costs were identified as "ranging between $27 million and $121 million". 52. The PAC said that it had considered the Air Quality and Greenhouse Gas Assessment (as one of the proponent's documents) and it should be taken at its word. That is the end of this ground. There is no basis for the serious allegation "that the PAC made a conscious decision to ignore" the proponent's assessment of downstream emissions: cf AS [38] (also repeated at AWS [64]). 1. In addition to this short form summary of the documentation before the PAC determination panel, it is also appropriate to set out more detailed extracts from the documentary material considered by the PAC Panel. This is set out under headings identifying the source document. The Project's Environmental Impact Statement 1. The executive summary of the project's Environmental Impact Statement (EIS) (Evidence Book, folio 131) sets out, in short form, what the EIS said was the position concerning greenhouse gas emissions. It read: Greenhouse Gas A greenhouse gas impact assessment was undertaken for the project by PAEHolmes. The main sources of greenhouse gas emissions from the project have been identified as resulting from electricity consumption, fugitive emissions of CO2 and CH, diesel usage, emissions associated with flaring and the transport and final use of the product coal. The proposed plan to capture and flaring of remaining CH4 during operations was found to have significant benefits in the reduction of greenhouse gas emissions. When compared with the base case involving unmitigated fugitive emissions of CH for, the flaring scenario results in a greenhouse gas saving of approximately 8MT CO2=e or 54% of Scope 1 emissions over the project life. Additional greenhouse gas savings may be realised through the use of on-site power generation which will be implemented if economically suitable to do so. The Project's contributions to projected climate change, and associated impacts, will be in proportion with its contribution to global greenhouse gas emissions. Average annual scope one emissions from the project (0.2 MT CO2=e) represent approximately 0.04% of Australia's annual average commitment under the Kyoto Protocol (591.5 MT CO2=e) and a very small proportion of global greenhouse gas emissions, given that Australia contributed approximately 1.5% of global greenhouse gas emissions in 2005 (Commonwealth of Australia, 2011). The Project will develop an Energy and Greenhouse Strategy within two years the commencement of longwall coal extraction. The strategy will address interim and long-term energy and greenhouse management plans and initiatives, including monitoring, reporting and continuous improvement. 1. The EIS noted (Evidence Book, folio 214) that cl 14(2) of the Mining SEPP was engaged for consideration. With respect to this provision, after setting the clause out in full, the EIS said: The Project has been designed to minimise, as far as practical, its impact on water resources, global warming and biodiversity. Impact minimisation is addressed in section 7.1, 7.2, 7.3, 7.4, 7.6 and 7.9 of this EIS. Further, a summary of management and mitigation measures incorporated into the project design are included in section 8. Applicable state and national policies, programs and guidelines in relation to greenhouse gas abatement are addressed in section 7.6. 1. The greenhouse gas section of the EIS (7.6) commenced at Evidence Book, folio 300. It is not necessary to reproduce the entirety of this section of the document. It is, however, appropriate to note that the section acknowledges that, in addressing Scope 1, 2 and 3 emissions, the following gases were considered in the assessment: * carbon dioxide; * methane; * nitrous oxide; and * four nominated synthetic gases. 1. At Evidence Book, folio 301, in Table 50, the EIS set out what were predicted to be the total greenhouse gas emissions that would be associated with the carrying out of the project over its life. These were set out under all three scopes against, as relevant, six potential emission sources. These sources were: * diesel; * fugitive mine ventilation here; * flaring; * electricity; * energy production; and * rail. 1. The table recorded that these emissions, over the life of the project, would be 6,786,770 tonnes of Scope 1 emissions; 1,477,707 tonnes of Scope 2 emissions; and 360,866,276 tonnes of Scope 3 emissions. The total emissions that would be associated with the project over its lifespan were said, in this table, to be 369,130,553 tonnes of greenhouse gases. The Department's Preliminary Assessment Report 1. The next relevant document was the Department's Preliminary Assessment Report. The relevant section is reproduced below (Evidence Book, folios 1701 and 1702): 5.7.3 Greenhouse Gas Emissions The EIS includes an assessment of greenhouse gas (GHG) emissions and potential impacts, undertaken by PAEHolmes. The Department acknowledges the potential climate change impacts caused by the burning of coal and other fossil fuels to provide the energy needs of various human societies, but does not consider that these in themselves should necessarily preclude the approval of the project. Rather, consideration of potential GHG impacts needs to be balanced, with due consideration given to: • the project's particular contribution to global warming/climate change; • whether refusing the development application would reduce global GHG emissions; • the benefits of the project, including job creation and its contribution to the NSW economy; • the objects of the EP&A Act, including the encouragement of ESD; and • available GHG impact mitigation measures. The GHG assessment calculates direct and indirect GHG emissions associated with the project, including 'Scope 1' emissions (ie direct GHG emissions from sources controlled by WACJV), 'Scope 2' emissions (ie indirect emissions associated with the import of electricity for use in the project) and 'Scope 3' emissions (ie other indirect emissions, such as those associated with the downstream combustion of the product coal). The calculated GHG emissions associated with the project are shown in Table 9. The assessment indicates that the vast majority (97.76%) of the total GHG emissions generated as a consequence of the project are those associated with the downstream burning of the product coal for energy production purposes - ie Scope 3 indirect emissions. The Department is satisfied that the project's contribution to annual global GHG emissions, even when assessed on a full life-cycle basis (ie including downstream GHG emissions), would be very small. 1. The Preliminary Assessment Report then reproduced a table which was, in effect, a summary of what had been set out in the greenhouse gas scope calculations in the EIS. It then continued. It must be noted that if the project was not allowed to proceed, the resultant gap in the thermal coal supply would be almost certainly filled by another coal resource, sourced either from elsewhere in NSW, Australia or overseas. In other words, preventing GHG emissions from the project would not result in any decrease in global CO2 emissions. This point illustrates the reality that the key response to the issue of climate change needs to be made at a national and international policy or strategic planning level, outside and above the project assessment process in NSW. The First PAC Review Report 1. As the chronology (at [14] above) records, in June 2014, after conducting the first PAC review of the (original) mine proposal, the PAC produced the First PAC Review Report. It addressed greenhouse gas emissions relevant to these grounds in the following terms (Evidence Book, folio 1973): 3.8.1 Greenhouse Gas Emissions The PAR says the strategic policy for greenhouse gas emissions should be made at a national and international level rather than at the project planning stage although several submissions including LMCC and WSC are critical of relying on a national approach as there is no carbon emissions trading scheme and the carbon tax is proposed to be abolished. The Commission accepts the validity of these concerns and therefore considers that all practical means should be adopted to minimise greenhouse gas emissions. The PAR notes that Scope 3 accounts for over 97 per cent of the total emissions and concludes that the project's contribution to annual global GHC emissions would be very small and if the project does not proceed then the coal would be sourced from elsewhere in Australia or overseas. The generalisation that the project's contribution to global CO2 emissions would be small could be applied to almost every project around the world and is therefore not a good comparison. It would be more helpful for comparisons to include Scope 1, 2 and 3 emissions for NSW, Australia and global. The Departmental Addendum Report 1. In July 2016, following the handing down of this Court's decision in Darkinjung Local Aboriginal Land Council v Wyong Coal Pty (No 2) [2014] NSWLEC 71, an amended development application for the mine was lodged. The Department prepared an Addendum Report to assist the PAC, as the amended development application for the mine was referred to a PAC Panel for a second review. The Addendum Report noted (Evidence Book, folio 2901): Greenhouse Gas Management WACJV previously committed to the development of an Energy and Greenhouse Strategy to focus on improving energy efficiency and reducing greenhouse gas emissions. The Department assessed the impacts of greenhouse gases in Section 5.7.3 of the PAR and considers that the nature and quantity of emissions has not materially changed between the original and amended project and continues to recommend the previously proposed management strategies. The Second PAC Review Report 1. In May 2017, a PAC Panel produced its Second PAC Review Report. This report endorsed the matters quoted from the earlier documents as set out between [61] and [64] above (Evidence Book, folio 3054). The PAC's Determination Report 1. On 16 January 2018, a freshly constituted PAC Panel finalised its determination report and granted conditional development consent to the proposed mine. The relevant elements of the PAC's Determination Report requiring consideration, for the purposes of Grounds 1, 2 and 3 of the Second FAS, are set out at [51] and, particularly, [52] above. Some preliminary matters concerning Grounds 1, 2 and 3 The composition of the PAC Panel 1. Although it was suggested that I might have regard to the fact that two of the three members of the PAC Panel that approved the proposed mine were also members of the separately established PAC Panel which conducted the second PAC review process (Transcript, 12 November 2018, page 44, lines 20-24), I am not prepared to do so. I did not understand that this proposition was strongly pressed. 2. Although the second PAC Review Report addresses greenhouse gas emissions, including downstream emissions, the only appropriate use to be made of the second PAC Review Report does not arise from the composition of the panel which undertook the review process but arises from the terms of the Review Report itself and the fact that the PAC Panel whose determination is challenged in these proceedings stated, in its determination, that it had considered the content of that Review Report. 3. Although the First Respondent put, at the end of (16) of its written submissions, that: This is not to say that consideration by the PAC acting as a review body is itself consideration by the PAC acting as a consent authority: cf AWS [37]. Rather, it is to say that it is inherently unlikely that the PAC would have "forgotten" and failed to have regard to things it had given considerable attention to over the course of the process when the PAC came ultimately to deciding to grant the Consent. The real relevance of the earlier review reports, arising from differently constituted PAC Panels, comes from the content of those reports and the inference to be drawn that the determining PAC Panel had had regard to those review reports as they are expressly referenced in the determination report. The extent of the referencing evidences them having been taken into account on the totality of the matters dealt with by them, not merely as to the topics specifically identified in the determination report. Wollar Progress Association Inc v Wilpinjong Coal Pty Ltd [2018] NSWLEC 92 1. The Applicant's written submissions, at (8) to (12), address the judgment of Sheahan J in Wollar Progress Association Inc v Wilpinjong Coal Pty Ltd [2018] NSWLEC 92, apparently in anticipation that one or other of the active respondents might seek to use that decision to found a submission that cl 14(2) of the Mining SEPP only applies to the imposition of conditions. 2. I mention this but briefly, as no such restrictive proposition was advanced on behalf of either the First Respondent or the Minister. Both the active respondents adopted the position that the two elements of cl 14 of the Mining SEPP operate together with the required assessment aiding the consent authority to consider what relevant conditions might/should be imposed (First Respondent's written submissions at (26)). Although the Minister's written submissions on this point were somewhat lengthier (from (37) to (43) of the written submissions), they are not inconsistent with the position advanced by the Applicant as to how I should approach the two elements of cl 14 of the Mining SEPP advanced by both the Applicant and the First Respondent. Reliance on the departmental advice 1. Preston CJ observed in Moorebank Recyclers Pty Ltd v Benedict Industries [2015] NSWLEC 40 (Moorebank Recyclers), at [155]: 155 A decision-maker is entitled to rely on the advice of its advisers, such as officers of a government department or local council, in making decisions, including forming any required satisfaction about a matter that is made a condition of the exercise of the power: see, for example, Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1086] HCA 40; (1986) 162 CLR 24 at 30-31, 65-66. However, when a decision-maker relies on advice, as it is entitled to do, and the advice is materially inadequate or misleading, any such failing may introduce legal error into the decision-maker's decision. Whether it does so will depend on the significance of the error or omission in the advice relied upon: Phosphate Resources Ltd v Minister for the Environment, Heritage and the Arts (No 2) [2008] FCA 1521; (2008) 251 ALR 80 at [95]. The need to avoid lapsing into merit review under the guise of judicial review 1. Minister for Planning v Walker (2008) 161 LGERA 423; [2008] NSWCA 224 (Walker) drew on a range of earlier decisions to caution about requiring, in judicial review proceedings, any greater degree of prescription in determining whether or not a consent authority has considered a matter or matters. In particular, in my consideration here engaged, the decision of Preston CJ in Walsh v Parramatta City Council (2007) 161 LGERA 118; [2007] NSWLEC 255 at [56] was cited with approval (citations omitted): An applicant dissatisfied with the merit assessment and outcome of an exercise of discretionary power by a consent authority make (sic) seek to disguise a challenge on those merits in terms of recognised grounds of judicial review, such as the relevant considerations grounds. A court should see through the disguise. The court must avoid the temptation to express the conclusion in terms of a recognised ground of review while in truth making a decision on the merits … The submissions on Grounds 1 and 2 The Applicant's position 1. The opening by Mr Leggat SC, on behalf of the Applicant, set the framework within which the Applicant proposed to advance its argument that the PAC's mandated consideration of greenhouse gas emissions had miscarried concerning downstream emissions. He said (Transcript, 12 November 2018, page 2, lines 43 to 47): The first mistake I'm going to call "the lens mistake." The second I'm going to call "the location mistake." Our submission in relation to the climate change grounds is that the approach that was taken by what I'll call the PAC 2, cl 14.2 of the mining SEPP, was influenced adversely by the lens mistake and the location mistake. 1. He described the basis of the "lens mistake' as follows (Transcript, 12 November 2018, page 3, lines 39 to 43): So it's clear from that that the opportunity was missed to draw to the attention of the decision-maker the important parts of cl 14.2, namely the consent authority must consider an assessment of the greenhouse gas emissions, including downstream emissions of the development. So that's the starting point of the lens mistake. 1. He later described the basis of "location mistake" as follows (Transcript, 12 November 2018, page 5, line 37 to page 6, line 14): If I can take your Honour to tab 24 at p 2614 and I'm now going to indicate the other mistake, the location mistake. So, p 2614, your Honour sees here, "6.4.2 Climate Change" and here we have the consultants responding to a concern expressed by the NCC, the Nature Conservation Council, about there being a focus on only scope 1 and scope 2 emissions. So, the NCC is stating, or the consultants are describing the NCC's concern that, putting it another way, scope 3 emissions, downstream emissions - and I'll come back to the relationship between scope 3 emissions and downstream emissions in due course, but your Honour sees there that the NCC's concern can be expressed in terms of a criticism that scope 3 emissions, downstream emissions, haven't been dealt with. Now, the response, if can invite your Honour to scroll down a little bit further, this sentence here, "In order to avoid", "In order to avoid double counting of emissions NGERS only requires companies to report scope 1 and scope 2 emissions as scope 3 emissions are reported where the fuel is combusted". That is the location mistake and that is the mistake that has been taken on board by the PAC. It is an approach that differs from the approach required by cl 14(2) of the mining SEPP because that provision, as your Honour has seen, requires that in determining a development application, the consent authority shall consider an assessment of greenhouse emissions including downstream emissions or scope 3 emissions. The consultants have said in response to the criticism of the NCC as to the lack of information about scope 3 emissions that scope 3 emissions are reported where the fuel is combusted. That is, are reported at that location, at the location where the fuel is combusted. Hence, that's why we're calling this "the location mistake". The Applicant's broad position in reply 1. The Applicant's argument in reply submissions responded to the written submissions advanced by the First Respondent (reproduced above at [54]) on the documents said to provide a proper factual basis to reject the Applicant's greenhouse gas emission grounds. The reply submissions said: 14 The FROS summarises at [39] to [52] the various documents before the PAC which addressed downstream GHG emissions. These documents could have provided the basis for consideration of an assessment of downstream GHG emissions, but the ultimate question is whether consideration actually occurred. The PAC Determination Report provides the best evidence of what the PAC considered at the point of determination, and it provides incontrovertible evidence to the contrary in the following: The Commission also acknowledges the greenhouse gas emissions that would be produced from any future burning of the coal extracted, .whether it is consumed locally or internationally. It is noted that presently there are alternative coal sources available to the market in the event that this mine does not proceed. Consequently, the downstream use of the coal (and any emissions abatement or capture technologies deployed) will need to be considered at that location. 15 The first respondent at FROS [54] construes the third sentence of this paragraph as if it contained the word "also", but this is not consistent with the sequence of ideas in the paragraph as a whole. It does not follow as a "consequence" of the availability of coal from other sources that the emissions must also be considered at the downstream location, rather the obvious connection between these two ideas is that the PAC believes that because of the substitutability of supply, the reduction of downstream emissions can more effectively be achieved by consideration at the downstream location than by consideration at the Project approval stage. 16 The use of the word "need" reinforces this construction. The PAC is saying that downstream emissions "need" to be considered at the downstream location, because it would be ineffectual to consider them now. 17 Put another way, if the PAC did not perceive consideration at the point of emission as an alternative to consideration at the point of approval of a coal mine, then why mention it at all? This fact was only relevant to the PAC's determination if it obviated the need to consider downstream GHG emissions when approving the project. 1. The Applicant's argument in reply submissions also responded to the written submissions advanced by the Minister on the documents said to provide a proper factual basis to reject the Applicant's greenhouse gas emission grounds. The reply submissions said: 14 The second respondent submits at SROS [46] that it is not in dispute that the PAC considered documents including the GHG Assessment. This statement, if left unanswered, could be misconstrued. The applicant accepts that the PAC had before it, and may have even read, the GHG Assessment which included an assessment of downstream GHG emissions. However, it does not accept that the PAC considered an assessment of downstream GHG emissions as required by cl 14(2), even if that obligation is construed as an obligation merely to consider a document. To read a document containing an assessment of downstream GHG emissions, and to take that assessment into consideration in making its decision are not the same thing. The paragraph quoted at [13] above shows that the PAC treated downstream GHG emissions as something which was irrelevant to its decision, therefore it also necessarily treated as irrelevant any document dealing with that subject-matter. 15 The FROS at [56] and SROS at [48](d) rely on various conditions which were imposed relating to GHG emissions. These conditions only related to direct emissions, and therefore do not assist the respondents. 1. The difficulties with the above submissions from the Applicant are twofold. First, they are of an impermissible "fine-tooth comb" degree of examination of what the PAC actually did. Second, they propose that the PAC was required to address the extraordinarily broad range of material before it in a fashion that did not consider and have proper regard to the material provided in the departmental and PAC review advice. Consideration of the "lens mistake" Introduction 1. Conflating Grounds 1 and 2, then separating them into argument streams, based on what Mr Leggat has described as the "lens mistake" and the "location mistake", makes it somewhat difficult to respond to the quite specific bases upon which Grounds 1 and 2 have been pleaded in the Second FAS. It seems to me that, in order to address the Applicant's case as pleaded, rather than in the less structured way it was argued in Mr Leggat's oral submissions, what was described as the "lens mistake" is, in reality, a bundling-up together of the various matters pleaded in Ground 2 (perhaps with some lesser but imprecise flavours of Ground 1 sprinkled in as well). 2. However, I propose to deal further with the "lens mistake" on this basis because that which needs to be analysed in this context, it seems to me, provides a proper basis to consider and dispose of Ground 2 (although out of the order of the pleadings). The content of the materials considered by the PAC 1. I have set out, at [72], the basis upon which the PAC was entitled to consider the departmental advice given to it. Although triggered by, and responsive to, the original development application, the EIS and, subsequently, the amended development application, the relevant elements of the departmental advice and the earlier PAC Review Reports have earlier been set out at [61] to [65]. In this regard, the earlier PAC Review Reports are to be encompassed within the observations from Moorebank Recyclers, set out at [72], concerning reliance on advice. 2. I accept the submissions on behalf of the active Respondents that the PAC acknowledging that it is properly is to be regarded as having considered, because it has so acknowledged the fact, the relevant range of documents and their content extracts earlier set out. Although not falling within the scope of Moorebank Recyclers, the EIS was also considered by the PAC - relevantly to Grounds 1 and 2 - those earlier extracted elements dealing with Scope 1, 2 and 3 greenhouse gas emissions. 3. Where those documents expressly addressed Scope 3 emissions directly or by necessary inference, I am satisfied that that which is set out concerning downstream greenhouse gases at [52], although laconic, is sufficient to establish that the PAC has had regard, as it was obliged to by cl 14(1) and (2) of the Mining SEPP, the question of downstream emissions that will arise from the burning of the coal proposed to be produced from this mine and that it has considered what conditions were appropriate to consider imposing and then actually impose concerning greenhouse gas emissions. 4. This, it seems to me, is a complete answer to Grounds 1 and 2. However, for completeness, I also turn to address other approaches to these two grounds which separately warrant the conclusion that they should be rejected. Absence of specific referencing of cl 14(2) of the Mining SEPP 1. In the context of what the Applicant describes as the "lens mistake", it is to be observed that the expression "clause 14(2) of the SEPP" is not some magical incantation, the repetition of which would legitimise the illegitimate or the absence of which would illegitimise the legitimate. The complaint made by the Applicant about the absence of specific repetitions of this formula will be quite without foundation if the PAC's Determination Report has adequately addressed the substance of what would be required to satisfy the terms of the provision despite the fact that it was not expressly referenced. 2. I am satisfied that that is here the case. This is clear from [32] of Manly Council v Hortis (2001) 113 LGERA 321; [2001] NSWCA 81 (Hortis) (a decision relied upon by the Applicant) that it is unnecessary to cite expressly a provision such as cl 14(2) of the Mining SEPP (let alone set out its terms) if that which is required to be addressed is, in fact, sufficiently addressed. There was no absence of express reference to the effect of cl 14(2) of the Mining SEPP in the extensive information available to the PAC making the determination (Hortis at [54]) and it is clear that the PAC considered all the material relevant to this point. 3. The "lens mistake" complaint basis for Ground 2 is rejected. Consideration of the "location mistake" The matters actually pleaded in Ground 1 1. Ground 1 relies on what are said to be a number of errors in the PAC's processes with respect to the requirements of cl 14(2) of the Mining SEPP. There are two primary bases of complaint with three being pleaded in the alternative. My reading of (6) to (8C) of Ground 1 as formally pleaded in the Second FAS requires my consideration of three separate elements of complaint - although pleaded in various permutations. They are, in my summary: * the PAC did not consider any assessment of the greenhouse gas emissions of the project when determining to grant development consent to it; * the PAC did not consider downstream emissions when determining whether or not to impose conditions pursuant to cl 14(1) of the Mining SEPP (including downstream emissions) despite cl 14(2) mandating this; and * the PAC did not consider whether it should impose specific conditions designed to address and limit downstream greenhouse gas emissions, which would result from the burning of coal mined from the project (whether that burning occurred locally or internationally). The relevant paragraph of the PAC's Determination Report 1. The relevant paragraph of the PAC's Determination Report The Commission also acknowledges the greenhouse gas emissions that would be produced from any future burning of the coal extracted, whether it is consumed locally or internationally. It is noted that presently there are alternative coal sources available to the market in the event that this mine does not proceed. Consequently, the downstream use of the coal (and any emissions abatement or capture technologies deployed) will need to be considered at that location. The essence of the "location mistake" 1. The essence of the "location mistake" is that the downstream emissions should have been dealt with in the context of this proposed mine, rather than being deferred to consideration in the context of emissions at the location of burning of the coal proposed to be extracted from this mine. Consideration of the "location mistake" 1. I have earlier set out what I consider the necessary approach is to be taken to reasons provided by the PAC in the determination report. On that basis, I consider that the final sentence of the element of the PAC's determination reasons (shown first at [52] and also in bold above) constitutes sufficient identification of the PAC having considered Scope 3 greenhouse gas emissions. In itself, this is sufficient to reject complaints about the PAC's Determination Report on the basis of the "location mistake". However, the Department's Preliminary Assessment Report (extract at [62]) also provided non-specific advice on where, in both a policy and geographic sense consideration, downstream greenhouse gas issues were appropriate to be considered. 2. In addition, for the reasons earlier set out, I am satisfied that the PAC did consider the issue of whether or not it was appropriate or possible to apply conditions to this consent dealing with Scope 3 emissions but that the PAC concluded that the appropriate place to deal with such emissions was at the location where they were caused to be emitted by the burning of the coal proposed to be produced by this mine or at the higher policy levels discussed in the earlier extract at [62]. 3. Although the "location mistake" was advanced for the Applicant as the second of the fundamental bases of attack on the PAC's Determination Report, it clearly was founded on Ground 1. 4. For the reasons outlined above, Ground 1 is rejected. Ground 3 Introduction 1. I have earlier set out Ground 3 as pleaded at [45]. It is not necessary to repeat its terms. However, it is appropriate to note that this ground finds its substantial foundation in the remarks of Hodgson JA, in Walker, where his Honour foreshadowed greater future necessity to have regard to ecologically sustainable development (ESD) and its attendant principles as arising out of issues of the public interest. Much of what was considered earlier for Grounds 1 and 2 has relevance to this consideration. However, although bundled in with those grounds by Mr Leggat, Ground 3 requires separate (albeit limited) consideration to dispose of it. 2. This does not require any necessity to resile from the sentiments expressed in Walker by Hodgson JA. My acceptance of those sentiments removes the necessity to set out any of the more expansive portions of the Applicant's written submissions on this ground. 3. It is sufficient to show that, in fact, the PAC did have regard, appropriately, to ESD through the adoption of advice given on this subject (see my earlier discussion on the topic of reliance on advice). The Departmental Addendum Report 1. Relevantly, the Departmental Addendum Report (Evidence Book, folio 2967) gave the following advice to the PAC: • Objectives of the EP&A Act Section 5 of the EP&A Act outlines a range of objects that must be considered when making decisions under the Act. A summary of the Department's consideration of the objects of the Act is provided in Section 3.6 of the PAR. The Department confirms that it has considered the objects of the Act in its assessment of the Wallarah 2 Coal Project, as amended. One of the key objects of the Act is "to encourage … ecologically sustainable development" (ESD). The Protection of the Environment Administration Act 1991 sets out a number of principles and programs through which ESD can be achieved. The Department has considered WACJV's consideration of these principles in the EIS. The PAR and AR in their totality address the principles and programs of ESD. The Department has also given particular consideration to the ESD principles and programs below. • Precautionary Principle The Department has considered the threats of serious or irreversible environmental damage to the environment in its assessment of the amended project. Whilst the amended project would result in a number of impacts of varying significance, the key threat for serious or irreversible environmental damage is the potential impact on surface water resources. The Department has carefully considered these impacts in its assessment of the amended project, and is satisfied that there is sufficient scientific certainty to enable the consent authority to weigh up the impacts of the project on surface water resources and determine the project. The Department's assessment has been guided by a careful evaluation of measures to avoid, where practicable, serious or irreversible environmental damage, and enable assessment of risk-weighted consequences of various options. The Department has taken a risk-based approach to the setting of draft conditions to mitigate and/or offset/compensate impacts on surface water resources and other environmental impacts, and is satisfied that any residual threats do not outweigh the benefits of the project. In particular, conditions requiring offsets for subsidence impacts on surface water resources that exceed the standard of negligible and/or minor subsidence impacts and environmental consequences reduce the risk of serious or irreversible environmental damage to a low and acceptable standard. • Intergenerational Equity The Department acknowledges that coal and other fossil fuel combustion is a known contributor to climate change, which has the potential to impact future generations. However, it also recognises that there remains for the foreseeable future a clear need to continue to mine coal deposits to meet society's basic energy needs. The Department also notes that climate change is a global phenomenon, the project's contribution to climate change would be very small and that WACJV has considered greenhouse gas mitigation measures. The Department also acknowledges that the downstream energy and other socio-economic benefits generated by the amended project would benefit future generations, particularly through the provision of international energy needs. The First Respondent's response to Ground 3 on the facts 1. The First Respondent addressed the factual aspects of this ground saying, in its written submissions: 73 The Department's Addendum Report again set out the principles of ESD and assessed the Project by reference to those principles (EB 2967-2968). The Department expressly addressed greenhouse gas mitigation measures in that context: EB 2967. 74 The ACA's own submissions to the PAC drew its attention to the connection between greenhouse gas emissions and the principles of ESD: EB 3413- 3416. 75 The PAC said that it had considered the public interest, including the objects of the Act: EB 3832. The PAC dealt in detail with ESD - and its connection to the conditions it had decided to impose - at EB 3845. Amongst other things, the PAC stated: The Commission notes that the precautionary principle is just one part of ecologically sustainable development … It has considered ecologically sustainable development in relation to the project and is satisfied principles such as inter and intra-generational equity, diversity and the internalisation of external costs will be assured through the requirements of the conditions. This includes requirements discussed elsewhere in this report to minimise greenhouse gas emissions … 76 In these circumstances, the Court could not infer that the PAC had failed to consider the public interest or, so far as relevant, the principles of ESD. The Minister's submissions on the factual matters relating to Ground 3 1. The Minister's submissions on the factual matters relating to Ground 3 comprehensively set out how the PAC did, as a matter of fact, address relevant ESD matters. This was set out in the written submissions as follows: 67 Here the PAC did consider the substance of ESD principles. The materials considered by the PAC and which it expressly stated it considered included extensive reference to these matters. Some of the references in those materials (but by no means all) are set out in the First Respondent's Submissions (1RS) at [71]-[74]. 68 The PAC Report itself states that the PAC has "considered carefully ... the public interest, including the objects of the EP&A Act": EB4/42/3832. It also recorded that the "key matters considered by the [PAC] during [the] process include ... the precautionary principle": EB4/42/3832. Section 5.7 of the PAC Report was headed "Precautionary Principle and other principles of Ecologically Sustainable Development" and contains a substantive discussion of those matters including by reference to a leading decision of this Court and s 6(2)(a) of the Protection of the Environment Administration Act 1991 (NSW) (EB4/42/3845). The entirety of that discussion is relied upon in full. Amongst other things, it records that "[t]he Commission has considered the precautionary principle in relation to all aspects of the project and its potential impacts". It discussed how various conditions it had imposed were consistent with its consideration of the precautionary principle and that it was "satisfied that the application of monitoring and an adaptive management approach will require operational changes where impacts are considered possible (and in extreme cases this may include the early closure of the mine)". It then went on to state: "The Commission notes that the precautionary principle is just one part of ecologically sustainable development (section 5(a)(vii) of the EP&A Act and section 6(2) of the Protection of the Environment Administration Act 1991). If has considered ecologically sustainable development in relation to the project and is satisfied principles such as inter and intra-generational equity, diversity and the internalisation of external costs will be assured through the requirements of the conditions. This includes requirements discussed elsewhere in this report to minimise greenhouse gas emissions …" 69 The PAC Report elsewhere recorded its adoption of "a precautionary approach" and its consideration of "the public interest": EB4/42/3846; and that the precautionary principle was a key issue raised at the public meeting: EB4/42/3853. Conclusion about Ground 3 on the facts 1. That which is set out in [101] above is sufficient to reject Ground 3 on the facts. The First Respondent's response on the requirements of the EP&A Act 1. The Applicant submitted that the nature of the PAC's decisions were mandated to "have the effect of limiting the dangerous effects of climate change" – saying, in its written submissions: 67 Given the scientific consensus that climate change is occurring, it should be uncontroversial that a core component of the public interest and the principles of ESD (including, in particular intergenerational ,equity) must be to make decisions about development applications that have the effect of limiting the dangerous effects of climate change. This necessarily includes an assessment of the Project's downstream emissions, which will result in a not insignificant amount of additional GHG emissions being released into the atmosphere. 1. The First Respondent's response was in the following terms: 78 The ACA's submission at AWS [67] that the Act requires decisions about development applications to "have the effect of limiting the dangerous effects of climate change" is, with respect, plainly wrong. The EP&A Act says no such thing. The EP&A Act recognises that planning and environment decisions are often controversial and the framework of statute and environmental planning instruments confers upon consent authorities the power to balance the various considerations and make a decision based on their attribution of weight to those matters. That occurred here. There was no judicially reviewable error in the PAC's consideration of ESD. 1. The First Respondent's position is to be preferred. The PAC was required to have regard to greenhouse gases. Indeed, although excluding Scope 3 emissions, the PAC has, as a matter of fact, imposed conditions having the effect proposed by the Applicant but it was not mandated to do so in the absolute and inevitable fashion proposed by the Applicant - it did so after a proper evaluation of the issues requiring consideration. Conclusion on Ground 3 1. For the reasons outlined above, Ground 3 is rejected. Ground 4 Introduction 1. The Applicant's Ground 4 was pleaded in the following terms: Ground 4 - failure to consider the impacts of the CCWSS Pipeline 19 Pursuant to s 79C(1)(b) of the EP&A Act, the Second Respondent was required to consider the likely impacts of the project, including environmental impacts on the natural and built environments. 20 The likely impacts of the project for the purposes of s 79C(1)(b) included the impacts of constructing a pipeline to discharge treated minewater to the Central Coast Water Supply System (the CCWSS Pipeline). 21 By reason of the matters set out in paragraphs 19 to 20 above, the impacts of constructing the CCWS Pipeline were a mandatory relevant matter to be considered by the PAC when determining the development application. 22 When deciding to grant the consent, the PAC did not consider the impacts of the CCWSS Pipeline. The necessity for water supply compensation 1. At Evidence Book, folio 3834, the PAC explained the reason why it was necessary for there to be a compensatory water arrangement for the Central Coast Water Supply. The PAC said: Reductions in surface flows are predicted at less than 300 ML a year. This impact is associated with both changing the topography of the alluvium (discussed above) and the storage of water within shallow cracks (predicted at up to 2.45 ML a year). In the 2014 review, that panel of the Commission considered this matter carefully and made a recommendation for the applicant to ensure that there would be no net impact on the water availability in the catchment. The Commission also found that the maximum predicted impacts on the catchment should be able to be offset with compensation of suitably treated mine water for any water loss during the life of the mine. The position concerning possible pipeline routes 1. The position concerning possible pipeline routes was expanded upon in the proponent's response to queries from the PAC. The response is set out in Appendix 8 to the PAC's Determination Report at Evidence Book, folio 3814. This reads: 2.4 COMPENSATORY WATER SUPPLY PIPELINE ROUTES 2.4.1 Issue 4 In relation to the compensatory water supply, are there any alternative pipeline routes and discharge points that could be pursued in the event options one and two currently presented are not able to be approved? 2.4.2 Response. The two preferred pipeline options are described in detail in the document "Response to DPE Queries over PAC2 Review Report" dated 13 July 2017. Section 2.6.2 of that report notes that the two alignments were developed in consultation with Central Coast Council (Council). A significant proportion of these two routes are proposed within WACJV land while the remainder is within public road reserves. The endpoint is Council's existing extraction point (near the pump pool above Wyong River weir). The pipelines anticipated disturbances minor and its construction is a type of roadside construction that is routine and low-risk, occurring throughout the region on an ongoing basis. Being a pipeline, the flexibility of the alignment allows the opportunity to avoid any relatively sensitive environmental or other features. As such, WACJV is confident that the further approval is required for either of these alignments will be forthcoming. However, there are other possible alignments on private land which could be further investigated should either of the preferred alignments be unable to be approved. These options were not pursued further, to date, to avoid interactions with private landholders. It should also be noted that it is approximately seven years from commencement of construction to the requirement to provide compensatory water supply, providing more than adequate time to secure any required subsequent approvals for final pipeline route and discharge points. The PAC's consideration 1. The introduction to the PAC's Determination Report said (at Evidence Book, folio 3829): As a result of the first review of the amended project by the Planning Assessment Commission (PAC) in April 2017, a compensatory agreement was required, whereby treated mine water is now proposed to be returned to the Central Coast Drinking Water Supply Catchment. The applicant has provided indicative pipeline route options and has also nominated a potential discharge point, in consultation with the Council. Approvals for these aspects are not included in this development application as the precise route and discharge location are not necessary to conclusively establish, as the means of providing 300ML of water per annum, including any potential pipeline route and discharge location, can be better ascertained close to the commencement of the compensatory water agreement, and are not prescribed in the conditions to this determination. Additional information on the potential impacts of the pipeline and water discharge will be required in a future application in order to assess and determine the acceptability of these elements. The recommended conditions for the current mining proposal require the compensatory agreement to be developed, prior to the extraction of Longwall 6N. Accordingly, mining operations would not continue into Longwall 6N and beyond unless the compensatory scheme is in place. The applicant confirmed that it is not necessary to finalise the plans for the pipeline and discharge point as part of this application, is it will not reach this point of mining longwall 6N, for approximately 10 years (which includes 1 year for a feasibility study, 3 years for construction and then 5 years of mining in longwall panels, 1N - 5N). 1. At Evidence Book, folio 3835, under the heading "5.2.1 Impacts and risks to the Central Coast water supply during mining", the PAC expanded on the summary elements set out above. It is unnecessary to repeat the entirety of what was said at folios 3834-3835. It is sufficient to note the conclusion at the end of this section, where the PAC said: The Commission is satisfied that there are options available and a solution to develop the infrastructure and deliver the compensatory water can be adequately resolved in the intervening years, prior to the mining of Longwall 6N. 1. The PAC therefore imposed a specific condition in the conditions of development consent to address this issue. The water supply compensation conditions The primary condition 1. Schedule 4 of the conditions of development consent for the mine is entitled "Specific Environmental Conditions - General". These conditions include Condition 17 of Schedule 4 (Evidence Book, folio 3881), the condition engaged for consideration by Ground 4. This condition is in the following terms: Central Coast water supply compensatory arrangement 17 Prior to the approval of any Extraction Plan that authorises extraction of Longwall 6N, the applicant must establish and implement a Central Coast Water Supply Compensatory Arrangement, which provides 300 ML per annum of water to the Central Coast Water Supply system. The Central Coast Water Supply Compensatory Arrangement must: (a) be prepared in consultation with the Council and CLWD; (b) be submitted for approval to the Secretary not less than 12 months prior to the planned extraction of Longwall 6N; (c) supply mine water treated to an appropriate level for release into the receiving environment in the Central Coast Water Supply including an equivalent or better quality for pH, dissolved oxygen and electrical conductivity as the receiving environment; (d) discharge at least 300 ML per annum of treated water directly into the Central Coast Water Supply system at a location mutually agreed with the Council; (e) incorporating an on-line water quality monitoring system that monitors River water quality upstream and downstream of the discharge point, and has the capability to connect to and integrate into Council's supervisory control and data acquisition system, in order to ensure that required water quality parameters for discharged treated water are met; (f) operate at least until a cessation of mining operations (see condition 5 of Schedule 2); and (g) include operational procedures for the compensatory water transfer system,, agreed with Council, to ensure that operation of the system is compatible with the Council's water supply infrastructure. Any dispute over the implementation of the arrangement may be referred by either party to the Secretary for resolution. The secondary conditions 1. Schedule 3 of the conditions of development consent for the mine is entitled "Specific Environmental Conditions - Underground Mining" of the conditions of consent (Evidence Book, folio 3871). These conditions include Conditions 6 and 7 of Schedule 3 (Evidence Book, folio 3873). 2. The permitted scope of the "first workings" is defined in Condition 6. It is clear that, for the purposes of Condition 7, "second workings" means underground mining of coal for commercial purposes. As a consequence, the first extraction plan for "second workings" will expire prior to commencement of second workings in Longwall 6N. Any extraction plan for Longwall 6N and beyond must be approved by the Secretary prior to commencement of the longwalls covered by it. 3. Relevantly, Condition 7 is in the following terms: Extraction Plan 7 The Applicant must prepare an Extraction Plan for all second workings on site to the satisfaction of the Secretary. Each Extraction Plan must: (a) … (b) cover not more than five longwalls in total; (c) be approved by the Secretary before the Applicant carries out any of the second workings covered by the plan; (d) … etc The Applicant's position 1. The Applicant's position was that this ground was on "all fours" with the position dealt with in the Malek Fahd Islamic School litigation (Hoxton Park Residents Action Group Inc v Liverpool City Council [2010] NSWLEC 242 - at first instance before Biscoe J - and Hoxton Park Residents Action Group Inc v Liverpool City Council (2011) 81 NSWLR 638; [2011] NSWCA 349, in the Court of Appeal). 2. The Applicant's position was outlined succinctly in its written submissions in the following terms: 76 In Hoxton Park Residents Action Group the Council approved the construction of a school. Before the school could open, a bridge would need to be built for access, and that bridge was likely to require some clearing of environmentally significant vegetation. The Council declined to consider the impacts of building the bridge, on the grounds that the bridge would be the subject of separate development application, and its environmental impacts considered at that stage. At first instance, in Hoxton Park Residents Action Group Inc v Liverpool City Council [2010] NSWLEC 242, Biscoe J held that the consent to the school was invalid because of failure to consider the impacts of the bridge. This decision was upheld on appeal. Basten JA (Giles JA and Macfarlan JA agreeing) observed at [53]: … Once it is found that a particular activity is a likely impact of the development for which approval is sought, the impacts flowing from that activity can only be excluded from consideration in respect of the development application if one reads into the language of s 79C(1)(b) an exclusion of environmental impacts which have been or are likely to be considered in relation to a separate development application required for that activity. 77 His Honour went on to find at [54]-[56] that there was no warrant in the statute for construing s 79C(1)(b) so as to exclude any impacts which were likely to be the subject of another assessment process. To the contrary, it would produce an undesirable consequence, because it would mean that the cumulative impacts of the development would escape assessment. 78 There is nothing legally incorrect in the PAC deciding that the final route and details of the pipeline should be the subject of further approval. What it could not do was defer its consideration of the impacts of the pipeline to the point in time where the final proposal for the pipeline came to be approved. It needed to at least consider whether the building of a pipeline could occur without causing unacceptable environmental impacts. The position of the active respondents 1. The First Respondent's position in its written submissions was that: 93 The PAC was plainly alive to the potential impacts of the construction of the pipeline. The PAC did not wholly defer consideration of those impacts: cf AWS [78]. It was aware that there might be impacts, but it was not in a position to make a precise finding on what those impacts would be - because the precise route of the pipeline was not yet known. 94 It was not unreasonable for the precise route of the pipeline to be determined in consultation with the Council over the coming years. The impacts of the pipeline, if and when constructed, would necessarily depend on the precise location of the pipeline. At the time of the decision to grant the consent, all that could be known was that a pipeline would (or might) need to be constructed. The precise impacts of that pipeline could not be known. The EP&A Act did not require the PAC to speculate on which route would be taken. Nor did it require the PAC to make precise findings as to the impacts which would result if different routes were adopted. The PAC's obligation was no more than to consider the likely impacts of the development. That does not extend to consideration of impacts which are not likely; and the duty is one of consideration, it is not a duty to make precise findings. 1. Mr Lancaster subsequently submitted (Transcript, 13 November 2018, page 52, lines 33 to 41): LANCASTER Here of course importantly, on our construction that I've just addressed, there will be no impacts at all if extraction doesn't proceed to longwall 6N and beyond. That's the first point. The second point is that mining can only proceed upon longwall 6N and beyond if the compensatory arrangement is in place, as approved by the Secretary. Perhaps most importantly of all, the PAC considered in the passage I've taken your Honour to, that there were options available and a solution existed and condition 17 was put in place with its demanding requirements for the pipeline and its operation in the future. The Minister's position 1. I have earlier set out, at [52], the relevant extract from the PAC's Determination Report. The Minister's written submissions emphasised the final sentence of that quotation, commenting: 82 The last sentence in particular, shows that the PAC did consider potential impacts and reached a state of satisfaction that an adequate solution could be developed and resolved. It could only reach that state of satisfaction having considered potential impacts. And again, beyond that the PAC did not need to consider in minute detail every possible hypothetical means of delivering the arrangement. Consideration 1. The transcript records the following submissions from Mr Leggat and exchanges with me (Transcript, 12 November 2018, page 14, line 15 to page 15, line 8) concerning the proposition that the position was analogous with the Hoxton Park case. LEGGAT: [The] Appellants submitted in the Land and Environment Court: "That although the construction of the bridge" - so just pausing there, that although the construction of the pipeline here - "Was not part of the development application, it was an essential element of the proposed development and accordingly failure to consider any likely impacts of the construction of the bridge invalidate the consent". Your Honour, that's our point, that we know that it's beyond argument that the pipeline was something that was necessary in order to provide the potential 300 megalitres per annum of water that was going to likely arise from the mine. HIS HONOUR: If we go back to the passage that you took me to on 3829 of the Evidence Book to what extent is the passage to which you took me, qualified by the sentence that follows it concerning longwall 6N - so in Hoxton Park, as I recollect, you couldn't have the school at all without the bridge. Is it the position in these proceedings, concerning the PAC's approval, that you can have the approval up to but prior to longwall 6N without needing the pipeline? And that all that is saying there is, and if the conditions reflected this, it might be in a different position to Hoxton Park; if those two following sentences say you've got consent for the mine up until longwall 6N assuming they're numbered logically - longwall 6M - then you don't need the pipeline and the compensatory water scheme. Whereas to go to 6N and whatever might be beyond that, you do require the scheme? LEGGAT: Your Honour, with respect, that's not the way the development consent was structured. It could have‑‑ HIS HONOUR: All right. I'm just dealing with this text now. You may need to take me later to the question of what the recommended conditions for the current mining proposal require concerning the compensatory agreement, but it seems to me that those two sentences potentially cast the operations of longwall 6N and beyond in a different position to that which arose in the Hoxton Park proceedings where you couldn't have the school at all unless you had the bridge. LEGGAT: Your Honour we don't see that factual difference being a point of distinction because of the manner in which the consent was granted. By that, what I mean is it was not a staged mining process whereby there was consent granted to continue up to 6N, at which time you could down tools and walk away from the site. 1. There are two significant differences between the position that arises in these proceedings and that which applied in Hoxton Park. The first is that there is no crystallised, immediate necessity for a pipeline. In Hoxton Park, the overall development of the school could not proceed without the bridge and a bridge that was over a defined route. In this instance, there is no defined pipeline route and, as the position is made clear, there is no inevitability that a pipeline to provide a compensatory water supply would be required unless the mine proposed to extend its mining life into and beyond Longwall 6N. 2. Indeed, in the absence of an approval for a pipeline to deliver the compensatory water, there will be no future mining into Longwall 6N or beyond. That is a distinctly different position from Hoxton Park. 3. Second, as the response from the proponent to the PAC queries, as set out in Appendix 8 to the determination report, records, whilst there are presently two identified pipeline routes, neither of them has been selected as a preferred route and the list of potential routes is not exhaustive. This position, when coupled with the fact that the necessity for a pipeline is a contingent one, only means that the response by the PAC of requiring a separate, subsequent application for approval of a pipeline was an entirely permissible (and, indeed, inevitable) approach. 4. Ground 4 is rejected Ground 5 Introduction 1. The Applicant's Ground 5 was pleaded in the following terms: Ground 5 - failure to consider flood impacts 24 Pursuant to 79C(1)(b) and (e) of the EP&A Act, the impact of flooding, including a. the risk of injury or loss of human life; b. the risk of damage to or loss of property; c. the risk to the livelihoods of private property owners; and c. the risk to private landowners of being forced to sell their properties; were mandatory relevant matters to be considered by the PAC when determining the development application. 25 When determining to grant the consent, the PAC did not consider the matters listed in paragraph 24 (a) to (d) above. 1. Of the four matters in the Applicant's (24) above, (b) was not pressed during the hearing (Transcript, 12 November 2018, page 21, lines 24-5). After noting this, Mr Leggat continued, saying (Transcript, 12 November 2018, page 21, lines 25 to 38): What we do advance is the proposition that items A, C and D were not the subject of consideration. In our written submissions, we've identified what we see as being the documents relied on by the respondents. What we've done is to look at each of those documents relied on by the respondents and satisfied ourselves that matters A, C and D in para 34 of the summons - so A relates to human injury or death, C relates to loss of livelihood and D relates to the forced sale. We'll be interested to see how it is that the respondents suggest that each of those matters have been dealt with. We know that their primary position is that that's a walker problem for us. That is, it's a level of specificity that is too great and we've made submissions about that if your Honour's with us and your Honour finds that those are likely impacts that ought to have been considered. 1. The Applicant's fundamental position was summarised in its written submissions (at (94)), in the following terms: In finding that the proposed mitigation measures (including the flood compensation condition) satisfactorily addressed flooding impacts on adversely affected dwellings, the PAC merely acknowledged. These impacts without legally considering them. In doing so, the PAC failed to consider the mandatory relevant matters listed in [paragraph 24 of the pleading], as required under section 79C(1)(b) and (e) of the EPA Act. 1. The Applicant cited Anderson v Director General of the Department of Environmental and Climate Change & Anor (2008) 163 LGERA 400; [2008] NSWCA 337 at [58], in support of this proposition. The cited paragraph in Anderson reads: Of course, the relevant matter must be more than adverted to or given mere lip service. Nor would it be sufficient to advert to the matter and then discard it as irrelevant: Elias v Federal Commissioner of Taxation [2002] FCA 845; (2002) 50 ATR 253 at 265 [62] per Hely J. But whether or not it can be judged that a matter has been considered is essentially an evaluative process based exclusively on what the decision-maker has said or written. That process is not, I believe, assisted to any significant degree by resorting to formulations which purport to qualify what is an ordinary English word, namely, 'consider' and which, as the Full Federal Court observed in Anthonypillai, invoke "language of indefinite and subjective application". 1. The First Respondent commenced its written submissions on Ground 5 by setting out three propositions underpinning this ground. They were (at (95)): First, the PAC's duty to consider the likely impacts of the project included a duty to consider the impact of flooding which, in turn, included a duty to consider the risk of injury or loss of human life, the risk of damage to or loss of property, the risk of the livelihoods of private property owners and the risk to private landowners of being forced to sell their properties (the Flood Risks). Secondly, the PACs duty to consider the public interest also included a duty to consider the Flood Risks. Thirdly, the PAC failed to consider the Flood Risks. 1. The submissions then continued by saying, at (96): The first two propositions in this ground suffer from the same defect apparent in earlier grounds, namely the error referred to in Walker. Was there a legal inadequacy? Introduction 1. The Walker error to which reference is made was developed earlier in the First Respondent's written submissions on this point. At (32), the First Respondent said, relevantly: Where an applicant contends that the decision-maker has failed to have regard to a mandatory consideration "the statute must expressly or impliedly oblige the decision-maker to enquire and consider the subject matter at the level of particularity involved in the applicant's consideration": Minister for Planning v Walker [2008] NSWCA 224, (2008) 161 LGERA 423 at [35]. 1. The cited paragraph in Walker, as earlier noted at [134], drew on a range of earlier decisions to caution about requiring, in judicial review proceedings, an inappropriate degree of particularity in determining whether or not a consent authority has considered any nominated matters. 2. This element of the First Respondent's submission then continued, at (32): This is reflected in the proposition that jurisdictional error is not established unless the statute expressly or impliedly makes the authority of the decision-maker conditional on that error not occurring: Maxcon Constructions Pty Ltd v Vadasz [2018] HCA 5, (2018) 92 ALJR 277 at [37] (Gageler J), [40] (Edelman J). It is incumbent on the ACA to establish that the Act expressly or impliedly oblige the PAC to consider the very particular considerations on which it relies. It has not done so. Consideration of the asserted legal impediment 1. It is therefore necessary to consider the relevant statutory provisions in the EP&A Act. First, s 89H mandates that s 79C of the Act applies to the merit assessment of State Significant Development (as this development is) and s 79C(1) is the element requiring consideration for this ground. This section was in the following terms: 79C Evaluation (1) Matters for consideration—general In determining a development application, a consent authority is to take into consideration such of the following matters as are of relevance to the development the subject of the development application: (a) the provisions of: (i) any environmental planning instrument, and (ii) any proposed instrument that is or has been the subject of public consultation under this Act and that has been notified to the consent authority (unless the Secretary has notified the consent authority that the making of the proposed instrument has been deferred indefinitely or has not been approved), and (iii) any development control plan, and (iiia) any planning agreement that has been entered into under section 93F, or any draft planning agreement that a developer has offered to enter into under section 93F, and (iv) the regulations (to the extent that they prescribe matters for the purposes of this paragraph), and (v) any coastal zone management plan (within the meaning of the Coastal Protection Act 1979), that apply to the land to which the development application relates, (b) the likely impacts of that development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality, (c) the suitability of the site for the development, (d) any submissions made in accordance with this Act or the regulations, (e) the public interest. 1. Mason J, in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40, at 39 to 40, observed: (b) What factors a decision-maker is bound to consider in making the decision is determined by construction of the statute conferring the discretion. If the statute expressly states the considerations to be taken into account, it will often be necessary for the court to decide whether those enumerated factors are exhaustive or merely inclusive. If the relevant factors - and in this context I use this expression to refer to the factors which the decision-maker is bound to consider - are not expressly stated, they must be determined by implication from the subject matter, scope and purpose of the Act. 1. The element of the decision of Preston CJ, in Walsh v Parramatta City Council, at [56], earlier set out, is here pertinent on the issue of slipping merit review into judicial review proceedings. The caution necessary to avoid sliding into impermissible merit review was described by Mason J in Peko‑Wallsend, at 40 to 42, as follows: (d) The limited role of a court reviewing the exercise of an administrative discretion must constantly be borne in mind. It is not the function of the court to substitute its own decision for that of the administrator by exercising a discretion which the legislature has vested in the administrator. Its role is to set limits on the exercise of that discretion, and a decision made within those boundaries cannot be impugned … But guidance may be found in the close analogy between judicial review of administrative action and appellate review of a judicial discretion. In the context of the latter, it has been held that an appellate court may review a discretionary judgment that has failed to give proper weight to a particular matter, but it will be slow to do so because a mere preference for a different result will not suffice. So too in the context of administrative law, a court should proceed with caution when reviewing an administrative decision on the ground that it does not give proper weight to relevant factors, lest it exceed its supervisory role by reviewing the decision on its merits. [Citations omitted] 1. In this instance, three matters now relied upon as subsets of the risks of flooding (as pleaded in (24) of Ground 5) specify a detailed level of particularity unwarranted in these circumstances. There can be little doubt that, had the PAC failed to consider the impact of flooding at all, that would likely have been an egregious failure to consider a relevant material fact so as to constitute an error of law potentially vitiating the PAC's decision. However, that was not the position in this instance. As later discussed, the PAC did consider flooding in its determination report and incorporated two relevant conditions of consent in the conditions attaching to its instrument of determination. These are dealt with below. 2. The complaint by the Applicant, in this regard, lacks proper legal foundation, as it seeks to have me cross the line and substitute my own views (if I was to accept the Applicant's position as to the range of factual matters necessary to be addressed) for the consideration approach adopted by the PAC at a broader level of generality. The broader level of generality approach adopted by the PAC is not inconsistent with the matters mandated for consideration in s 79C of the EP&A Act. 3. This ground is to be rejected on this basis alone. Was there a factual inadequacy? Introduction 1. For the purposes of considering whether or not there was a factual inadequacy in the PAC's consideration of flood risks, I observe that, in the First Respondent's written submissions, the relevant information from the documents the PAC nominated as being considered in its determination assessment were set out at (99) to (106). It is unnecessary for the purposes of this consideration of factual adequacy to go to any of that material. 2. However, at (107), the First Respondent's written submissions identified where the PAC addressed the question of flooding impacts in its determination report. It is also unnecessary to any of that material, as I accept the accuracy of what is set out immediately below. The submission read, in this regard: In its determination report, the PAC expressly addressed flooding impacts: EB 3838-3839. It identified the risk of flooding: EB 3838. It identify the number of households which might be affected: EB 3838. The PAC ultimately concluded that flooding impacts had been adequately addressed: EB 3839. It. 1. This element of the First Respondent's written submissions then proceeded to propose that: It should not be inferred that the PAC was not alive to the possibility of a flood, if it occurred, could cause injury, a loss of life or damage to property. 1. It is unnecessary to consider this aspect of the submission in this factual context as it would be contrary to the matters I have set out above concerning the legal scope of my enquiry in these proceedings. The flooding conditions 1. However, the First Respondent's submissions then identified, in (108), the flooding conditions that had been incorporated in the conditions of consent. There were two relevant conditions contained in Schedule 3 Specific Environmental Conditions - Underground Mining. The first of these, an element of Condition 7 Extraction Plan, required, in the third dot point of Condition 7(h)(iii), the development of a Flood Management Protocol as an element of the Water Management Plan required by this element of the Condition 7. The Flood Management Protocol (Evidence Book, folio 3874) is mandated to: • identify secondary access routes for those properties that could potentially be adversely impacted by 1% AEP flood events; • regularly consult with landowners that could not have either a primary or secondary access route during 1% AEP flood events; • provide up-to-date information (including subsidence and flooding predictions) to the State emergency service and counsel regarding privately owned residences that could be adversely affected by lack of access during 1% AEP flood events; and • work with landowners, State emergency service and counsel to develop evacuation plans to ensure landowners know what to do in the event of emergency as a result of a 1% AEP flood event; 1. In addition, Condition 9 Water Monitoring Program also includes (Evidence Book, folio 3875), at 9(g)(iii), the requirement that the Water Monitoring Program must include a flood monitoring program to monitor and report on: * updated flood modelling; * measures to minimise, manage and mitigate (whether prospectively or retrospectively) flood impacts on key public infrastructure, other public infrastructure, residences, other built features and privately owned land; and * private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered. 1. All this demonstrates, at a sufficient level of particularity necessary for satisfaction of matters in s 79C of the EP&A Act, engagement with, and response to, matters of flood risk. 2. This ground is also to be rejected on this basis. Conclusion on Ground 5 1. Ground 5 is rejected. Ground 6 Introduction 1. The Applicant's Ground 6 was pleaded in the following terms: Ground 6 - error of fact in relation to flooding impacts 27 When deciding to grant the consent, the PAC made an erroneous finding of fact that the proponent had made a binding commitment to purchase any flood-affected properties at a fair value, if other mitigation measures for those properties proved not to be reasonable or feasible. 27A The finding of fact referred to in paragraph 27 above amounted to a constructive failure on the part of the PAC to exercise its jurisdiction to consider the impacts of the proposal on the built environment, and social and economic impacts in the locality under ss 89H and 79C(1)(b) of the EP&AAct. 27B In the alternative to 27A there was no evidence to support the finding of fact referred to in paragraph 27 above. ​The relevant background 1. ​The relevant background was, helpfully, set out in the First Respondent ' s written submissions as follows: 119 Flood impact and mitigation were addressed in the EIS Main Report. The EIS Main Report identified subsidence as a potential cause of increased flood risk: see EB 288-289. 120 The proponent there referred to various available options where property was flood affected. Those options include modification of the properties (by, for example, house raising, house relocation or flood levees). In respect of five identified properties, the EIS Main Report referred to flood levees as a suitable mitigation measure (EB 295). The report then stated (EB 295): There are some high hazard areas where property modification options are impractical or ineffective. In these situations, WACJV may need to purchase the affected properties or provide compensation. 121 The Flood Impact Assessment (EB Tab 7), which was part of the EIS, also addressed mitigation measures. It stated: Four options are recommended for properties adversely impacted by the project within the study area. These are: • house raising; • house relocation; • flood proofing, with individual flood levees; and • voluntary purchase or other compensation measures. 122 In respect of the last of these options, the Flood Impact Assessment stated (EB 852): In certain high hazard areas of the floodplain, it may be impractical or unacceptable to property owners to mitigate the impacts of mining induced changes to flooding by any of the above options. Under such circumstances, the property may need to be purchased at an equitable price or other negotiated compensation may need to be made. 123 The EIS Main Report also addressed mitigation in respect of subsidence issues (EB 110-111). The EIS stated (inter alia) that "property-specific PSMPs [Property Subsidence Management Plans] will be progressively prepared throughout the mine life as longwall mining progresses across the Extraction Area and will outline, for example, the agreed management arrangements for mitigation and remediation of property improvements potentially affected by subsidence". 124 WACJV returned to the issue of flood mitigation in its Response to Submissions dated 16 September 2013. That response stated (inter alia) (EB 1341-1342): The objective of the FIA was to accurately identify every property that may be adversely affected as a result of changes to flood behaviour for floods up to the 100 year ARI flood event. Appropriate mitigation measures will be developed and implemented through PSMPs. WACJV will develop PSMPs for the 27 dwellings that are predicted to experience major, moderate or minor adverse flooding impacts as a result of the project. The 14 dwellings in the negligible impact category are not expected to require mitigation measures as those dwellings will continue to satisfy planning requirements for freeboard and flood risk. In all instances, mitigation measures must ensure that the new, modified or relocated house will be flood free (i.e. >0.5 m freeboard above maximum flood level in a 100 year ARI event). This requirement ensures that no property owners will be adversely affected by the mitigation process. Given that many of these buildings are already flood prone, it can be expected that most property owners will derive a general benefit from these proposed mitigation measures. In some circumstances, mitigation measures may be impractical or unacceptable to property owners. As a result, voluntary purchase of properties by WACJV is also an available option. Arrangements for voluntary purchase will be developed by WACJV with property owners and will be included in PSMPs. The description of mitigation options in Section 7 of the FIA was not intended to be an exhaustive list of options that may be considered for the PSMPs, nor was it intended to suggest a particular option for any specific property. Each individual PSMP will be developed in consultation with each property owner and in accordance with WSC's planning requirements to determine the best mitigation for that property and with due consideration of costs and appropriateness to individual circumstances. Any secondary impacts that might result from mitigation works will also be addressed as part of the PSMPs. During the development of PSMPs, WACJV will work close with WSC to confirm that the impacted properties identified in the FIA are properly considered and that controls in impacted areas are appropriately updated. WACJV will be obligated under the Mining Act 1992 and its Development Consent to address and mitigation adverse impacts caused by changes to flood behaviour as a result of the project. WACJV will commit to complying with all legal and planning requirements and to work closely with the community to meet expectations as far as practicable. (emphasis added) 125 Subsequently, the Department prepared its Assessment Report. The Assessment Report stated (EB 1685): WACJV has committed to mitigation and management measures to prevent or reduce impacts to properties that are adversely affected by mining-induced flood impacts. These measures can include house raising, house relocation, flood proofing, compensation or acquisition. The FIA has identified that house raising and relocation are suitable measures for D0060 (proposed to be raised 0.6 m), D0061 (to be raised 0.9 m) and D0237 (to be raised 2 m), while flood levees are suitable for five other dwellings (D0017, D0058, D0737, D0063 and D0430). There are some high hazard areas where property modification options are likely to be impractical or ineffective. In these situations, WACJV has committed to purchasing the properties or providing compensation. The FIA has also identified measures to ensure that roads are altered to prevent adverse flood impacts. The Department has recommended conditions of consent requiring that the Water Management Plan which must be prepared as part of any Extraction Plan, must include a program to monitor flooding (including updated flood modelling); minimise, manage and mitigate flood impacts on residences, private properties, roads and other infrastructure; and identify private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered. (emphasis added) 126 It can immediately be observed that the emphasised statement provided a factual basis for the PAC to make the impugned observation. That must be the end of the "no evidence" ground: cf AWS [107]. 127 Annexed to the Department's Assessment Report were draft conditions, including one which stated that the proponent was to prepare a Water Management Plan including: A program to monitor flooding (including updated flood modelling); minimise, manage and mitigate (whether prospectively or retrospectively) flood impacts on residences, private properties, roads, other infrastructure and other built features; and identify private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered. 128 Thereafter, the PAC's first Review Report noted (in respect of flooding) (EB 1966): The Proponent will cover all costs associated with the mitigation of impacts caused by mining. These mitigation measures may include: • house raising; • house relocation; • flood proofing within individual flood levees; • voluntary purchase or other compensation measures; and • raising roads and bridges. 129 In the Department's Addendum Report a slight revised form of the condition which had appeared in the Assessment Report was recommended: EB 2951-2. 130 A condition to the effect of that recommended in the Department's Assessment Report and the Department's Addendum Report was eventually included in Condition 9 of Schedule 3 of the consent. That condition requires the proponent to prepare and implement a Water Monitoring Program which must include a: Flood monitoring program to monitor and report on: • updated flood modelling; • measures to minimise, manage and mitigation (whether prospectively or retrospectively) flood impacts on key public infrastructure, residences, other built features and privately-owned land; and • private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered … The complained of paragraph 1. The determination report said (Evidence Book, folio 3838), concerning the proponent's response to flooding: Mitigation and management measures are proposed for the adversely affected dwellings, including house lifting or relocation for certain properties and flood levies for five others. Where property modifications are impractical or ineffective, the applicant has committed to purchasing the properties, or providing compensation. (emphasis added) 1. The PAC's general conclusion when dealing with flooding was in the following terms (Evidence Book, folio 3839): The Commission is satisfied that flooding impacts have been adequately addressed by both the department and the applicant. The department has strengthened the conditions of consent on the adaptive management approach and validation of the subsidence model, and has require the applicant to execute proper planning on flood risks and impacts with affected landowners and appropriate authorities. The commission has also clarified in the conditions, that public roads affected by flooding. As a result of mine subsidence must remain safe and serviceable, ensuring residents will not be adversely affected by roads becoming impassable where they are not currently subjected to flooding. The PAC's flooding compensation condition 1. The condition concerning flood compensation is, relevantly, in the following terms in Schedule 3 Specific Environmental Conditions - Underground Mining of the conditions of consent (Evidence Book, folio 3875): Water Monitoring Program 9 Prior to longwall extraction and as part of each Extraction Plan, the Applicant must prepare a Water Monitoring Program for the areas of the development subject to or potentially affected by underground mining, to the satisfaction of the Secretary. This program must: (a) … (b) … (c) … (d) … (e) … (f) … (g) … (i) … (ii) … (iii) flooding monitoring program to monitor and report on: • … • … • private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered; and (iv) … The Applicant must implement the approved Water Monitoring Program as approved by the Secretary. The Applicant's position 1. Mr Leggat submitted (Transcript, 12 November 2018, page 17, lines 5 to 12): LEGGAT Our ground is based on the proposition that the applicant had not committed to purchase the properties, and accordingly the PAC had no evidence in order to be able to satisfy itself that that was a suitable way to consider the flooding impact of the proposed coal mine in relation to the 88 and 33 dwellings. Your Honour has seen our submissions that that same factual matrix about the applicant not having committed to purchase the properties can be characterised, according to the cases, as a constructive failure to exercise jurisdiction. 1. Mr Leggat also said (Transcript, 12 November 2018, page 19, lines 6 to 13): Now, the fact that the Department may have unwittingly provided what's described as materially inadequate or misleading information, as Preston J has indicated, introduces legal error into the decision‑maker's decision. So it's not as though a misstatement by the Department can be relied upon by impunity; rather, as Preston J says, that is the situation there. So that's what I describe as the no evidence approach, the authorities in relation to no evidence concerning the statement by the PAC about the applicant having committed to purchase properties. 1. The Applicant also advanced this ground on the basis that there was a constructive failure by the PAC to exercise its discretion on this issue (Transcript, 12 November 2018, page 19, lines 21 to 30): LEGGAT … So just pausing there, where the PAC needed to deal with the question of the likely impact arising from flooding, and had information about the - I'll call it the 88 dwellings that were potentially threatened - the PAC needed to bring its own mind to bear on the issue of whether or not a way of considering the flooding impact was to require the applicant to purchase properties and the PAC relied on the statement that the applicant had committed to purchase properties, rather than satisfying itself, rather than bringing its own mind to bear on the issue before it of whether or not Wyong actually had made such a commitment, and that the condition didn't require it. So we didn't have the PAC bringing its own mind to bear on that point. The First Respondent's position 1. The detailed position of the First Respondent can be discerned from the following extract from the First Respondent's written submissions: [Note: FIA is Flood Impact Assessment and PAR is Project Assessment Report] 97 These statements in the FIA all used the word "may" rather than "must". They should be construed as statements by the author of the report recommending a course of action which could be taken by the proponents to address residual flooding impacts. They were not representations made by WACJV as to what it proposed to do to address these impacts, and even if they had been, they were too vague to be given any weight in the decision-making process. An offer to acquire affected properties was of no value in the absence of any details about matters such as who could trigger the acquisition process, how the value of the land would be determined, and who would resolve disputes in the event that WACJV and the landowners were unable to agree on the value of the land. 98 The Department's PAR stated: WACJV has committed to mitigation and management measures to prevent or reduce impacts to properties that are adversely affected by mining-induced flood impacts. These measures can include house raising, house relocation, flood proofing, compensation or acquisition. 99 For the reasons stated above, the description of WACJV as being "committed" to mitigation measures including acquisition was not accurate if it was based on the FIA. In the PAR, the Department also recommended a condition requiring the proponent to report on "private properties where mitigation measures are not reasonable or feasible and compensation would instead be offered". This became the Flood Compensation Condition. However the Flood Compensation Condition, taken at its highest, does not impose any obligation to acquire properties. Whether it even imposes a binding obligation to pay compensation for flood affectation is doubtful (see Ground 7 below). 100 Property acquisitions were not further discussed in the First PAC Review Report, although the PAC did recommend that "compensation" be paid to affected landholders. There was no new flood impact assessment submitted with the Amended DA, because the deletion of the rail spur line was not predicted to change flooding behaviour. The Department's Addendum Report again recommended a condition in the same terms as the Flood Compensation Condition. In the Second PAC Review Report, the PAC said it was satisfied draft conditions proposed in the Addendum Report addressed the potential flooding impacts of the project. The issue was not further explored in the Department's Residual Matters Report. 101 Nor did the proponent come forward with a more concrete promise to acquire affected properties later in the process. Voluntary purchase was merely described as an "available option" in the Response to Submissions dated 16 September 2013. There is no reference to acquisition for flood affectation in any other communication or materials submitted by WACJV. The PAC's exercise of jurisdiction relevant to Ground 6 1. The First Respondent's written submissions on this point commenced by saying (at (112)) the following: The ground, in part, involves a contention that a court can impugn an administrative decision because it involved an error of fact. 1. In support of this proposition, the First Respondent relied on the remarks by Mason CJ in Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321; [1990] HCA 33 at 355-356. It is, however, clear from what was said in the passage to which reference was made that some decision must have been made based on the error of fact. In this instance, although there was no specific evidence upon which the particular assertion by the PAC could be founded, they did not, and did not need to, make any determination based on that "fact" - it was merely a matter taken into account in formulating the relevant conditions of consent in the fashion elsewhere set out. 2. Although the PAC has, for the reasons earlier set out, made an erroneous finding of fact in asserting that the proponent had agreed to a regime whereby it would acquire properties where flood affectation would occur and where remediation or lesser compensation than acquisition was inappropriate, the question that then requires to be considered is for what purpose, if any, did the PAC rely upon that erroneous finding when exercising its jurisdiction to determine and approve the proposed mine, subject to conditions. 3. From the PAC's general conclusion, it is clear that the PAC drew no specific conclusion that it was necessary to impose, in the conditions of consent, a requirement for the acquisition of flood-affected properties by the proponent. 4. The position here applicable to the PAC's process is quite unlike that which arose for consideration in Parramatta City Council v Hale (1982) 47 LGERA 319, where the facts before the Council, as the determining authority for the stadium application, clearly disclosed that there were significant traffic and parking impacts but failed to provide any condition in response to it. 5. Here, although there has been an erroneous finding of fact by the PAC, there is nothing which would mandate the PAC to insert a specific element in the conditions of consent in response to that finding. 6. There is, however, no doubt that the PAC did insert a requirement in the conditions of consent dealing with the necessity for compensation to be provided, in some fashion, with respect to flood-affected properties. 7. Whether or not, as a matter of fact, the proponent had offered to undertake such acquisition is irrelevant. The PAC made no finding that such acquisition was necessary, merely that the broad concept of compensation was appropriate. 8. It is well established that, as a matter of general principle, to make a finding of fact for which there is no evidence is to make an error of law (Kostas v HIA Insurance Services Pty Ltd (2010) 241 CLR 390; [2010] HCA 32 at [91] (Hayne, Heydon, Crennan and Kiefel JJ)). 9. Although there was a deal of vigorous argument about whether the assertion by the PAC had proper foundation or was material, little to no attention was paid to what the effect of that assertion was or was not in the PAC's exercise of its determination function. 10. How that determination function was exercised lies not merely with the instrument of determination (Evidence Book, folio 3865), but also everything contained in Schedule 1 (defining the project) and Schedules 2 to 6 (being the schedules which incorporate the various conditions of consent). 11. The particular condition (Schedule 4, Condition G(iii), third dot point), being the relevant condition concerning flooding compensation, makes no reference to property acquisition. There is, therefore, no basis to conclude that the established but erroneous finding of fact (that the proponent had committed to acquiring significantly adversely flood-affected properties) was in any way reflected in this condition. 12. The consequence of this, it seems to me, is that the erroneous finding of fact did not, in any way, colour or taint the actual exercise of the power with which the PAC was invested as the PAC did not purport to impose any condition based on that erroneous finding of fact. 13. Ground 6 is rejected. Grounds 7 and 8 1. On the first day of the hearing, Mr Leggat advised me (Transcript, 12 November 2018, page 19, line 48 to page 20, line 4): Now, your Honour may have seen that ground 7 and ground 8 were put in the alternative to ground 6; that is that if the respondents were to contend that they were under an obligation to purchase properties, then ground 7 and ground 8 looked at whether or not there was power to impose such a condition. But in circumstances where, as here, the respondents do not contend that condition 9 provided an obligation to purchase properties, well then ground 7 and 8 are not relevant and don't need to be determined. 1. As a consequence, I do not address these two grounds. Considering Grounds 9 and 10 together Introduction 1. Mr Leggat said (Transcript, 12 November 2018, page 22, lines 10 to 20): The way 9, grounds 9 and 10 work together is that rather than considering the likely impacts, there was an approach taken whereby the consideration was in effect left to the Secretary to determine what was satisfactory compensation and the PAC has relied on those conditions as being the way to deal with the acceptability of the impacts and as your Honour knows, we've identified ground 9 in terms of s 79C(1)(b) and (c) of the Act not having been considered. As I said, once we've seen exactly how it is that our learned friends suggest that the matters were considered by reference to the documents and once we've understood their argument as to how it is the Secretary's satisfaction solution demonstrates a consideration of the likely impacts then we'll respond to that in reply. 1. Although these are separate grounds, it is convenient to deal with them in a single section of this judgment, although separate reasons apply for rejecting each of them. 2. I turn, first, to Ground 9. Ground 9 Introduction 1. The Applicant's Ground 9 was pleaded in the following terms: Ground 9 - Failure to consider the risk to private water supplies 39 Pursuant to s 79C(1)(b) and (e) of the EP&A Act, the risks of the project to the long-term water supply of private landowners, including: a. the risk of loss of water from private bores, riparian rights and irrigation entitlements; b. whether it was possible to provide a replacement water supply to those landowners; c. whether it was possible to provide other effective compensation to those landowners; d. and the potential impacts of loss of long-term water supply on the livelihoods of those private landowners; were mandatory relevant matters to be considered by the PAC when determining the development application. 40 When determining to grant consent to the project, the PAC did not consider the matters listed in paragraph 39 (a) to (d) above. 1. Of the four matters in the Applicant's (39) above, (a) and (b) were not pressed during the hearing (Transcript, 12 November 2018, page 21, lines 24 to 25). The Water Supply Condition 1. Schedule 4 of the conditions of development consent for the mine is entitled "Specific Environmental Conditions - General". These conditions include Condition 16 of Schedule 4 (Evidence Book, folio 3881), the condition engaged for consideration by Grounds 9 and 10. The condition is in the following terms: Compensatory Water Supply 16 Prior to the commencement of extraction of coal, the Applicant must notify any owner of privately-owned land whose water supply could potentially be affected by the development of their right to a compensatory water supply, if their water supply is adversely and directly impacted as a result of the development. The Applicant must provide a compensatory water supply to any owner of privately-owned land whose water supply is adversely affected and directly impacted (other than a negligible impact) as a result of the development, in consultation with CLWD and to the satisfaction of the Secretary. The compensatory water supply measures must provide an alternative long-term supply of water that is equivalent, in quality and volume, to the loss attributed to the development. Equivalent water supply must be provided (at least on an interim basis) within 24 hours of the loss being identified. If the Applicant and the landowner cannot agree on the measures to be implemented, or there is a dispute about the implementation of these measures, then either party may refer the matter to the Secretary for resolution. The Applicant's written submissions' position on Ground 9 1. The Applicant's written submissions' position on Ground 9 were in the following terms: 141 The PAC Determination Report acknowledged that key potential impacts of the Project included "impacts on ground water, including the loss of water to existing bores." The PAC then noted that "conditions require the applicant to compensate the owner of any privately-owned land for any adverse impacts on their water supply." Finally, the PAC concluded: "(w)ith these conditions in place the Commission is satisfied that impacts on surface and groundwater resources ... can be acceptably managed. 142 The reference above to "conditions" relies on what became Schedule 4, Condition 16 of the Consent (the Water Supply Condition). For the reasons set out in Ground 10 below, the Water Supply Condition was invalid. 143 In the alternative, if the Water Supply Condition was valid, there is no evidence that the PAC considered the impact of the Project on the long-term water supply of private landowners, including the risks listed in [39](a) to (d) of the FAS. These impacts would encompass (without limitation) the social and economic impacts of a long-term loss of water on private landowners. These are clearly social and economic impacts with a "real chance or possibility" of occurrence as a result of the Project. They are also clearly matters relevant to the PAC's consideration of the public interest. 144 In finding that the Water Supply Condition satisfactorily addressed the impacts of the Project on ground and surface water, including the loss of water to existing bores, the PAC merely acknowledged these impacts without fully undertaking the required task of consideration. In doing so, the PAC failed to consider the mandatory relevant matters listed at [39](a) to (d) of the FAS, as required under s 79C(1)(b) and (e) of the EPA Act. The Applicant's reply position on Ground 9 1. In his oral submissions in reply, Mr Leggat said (Transcript, 14 November 2018, page 122, lines 31 to 46): Ground 9 and 10 hump together, so to speak. Perhaps the most important part of ground 9 in terms of a response is at para 141 in the second sentence where the PAC links the likely impacts to the condition - and this is the second sentence of 141 when it's stated the PAC then noted the conditions require the applicant to compensate the owner. And then the PAC concluded, "With these conditions in place, the commission is satisfied that the impacts on surface and groundwater resources can be acceptably managed." So that is, in our respectful submission, the Weal v Bathurst error. It's relying on a condition to deal with the impact on surface and groundwater resources. And the reason why that humps with para 10 is the same way in which it did in Weal v Bathurst, but by, as we put it, deferring consideration, deferring the setting of the levels, so to speak, deferring to the secretary, the setting the level of compensation in the same way that the EPA was left to settle the acoustic level. That was the manner in which the likely impacts were considered and managed, and it was not a legally acceptable consideration. Consideration 1. It is unnecessary to set out any of the submissions made by the First Respondent or the Minister concerning the Applicant's attack in Ground 9 on Condition 16 in Schedule 4 of the conditions of consent for this project. 2. I earlier explained with respect to Ground 5, why, on a legal reasoning basis, descending into quite specific particularity in the matters said to found a challenge to the PAC's determination, was an erroneous approach. It is unnecessary to repeat that approach with respect to my assessment of Ground 9. Those comments were, however, equally applicable here and Ground 9 warrants being approached with a deal of caution on this basis. 3. As best I am able to understand it, from the quite limited basis of the Applicant's submissions on this ground, the error that they assert arises from that which is left of Ground 9 (pleaded elements (a) and (b) having been abandoned) is an assertion that the PAC has deferred to later consideration by the Secretary relevant matters with respect to (39)(c) and (d), as earlier set out. This is said to be in breach of the approach mandated by Weal v Bathurst City Council (2000) 111 LGERA 181; [2000] NSWCA 88 that no fundamental matter should be deferred to some other decision-maker but must be addressed by the determining authority. There are two reasons why this is to be rejected. 4. First, it is clear that the PAC did make findings relevant to these elements of Ground 9. This is obvious from the determination report at Evidence Book, folios 3834 and 3836. 5. First, as noted in the Applicant's written submissions, the PAC introduced its consideration of water impacts, relevantly, in the following terms: 5.2 Water Potential impacts on water have been considered in detail in the assessment and reviews of the application. Key potential impacts and risks can be categorised as: • … • … • impacts on groundwater, including the loss of water to existing bores, availability of water for any future bores and the management of water within the mine underground workings. 1. Subsequently, in its determination report, at folio 3836, the PAC dealt with groundwater impacts, this being the topic relevant to (39)(c) and (d), being the two elements of Ground 9 remaining pressed by the Applicant. The PAC said: 5.2.2 Groundwater and acceptability of water take Concerns about the impact on groundwater, including the volume of water captured by the mine and the associated impacts on existing and potential future groundwater bores were raised by members of the public with the Commission. In particular it was suggested that the mine's impact would be inconsistent with the NSW Aquifer Interference Policy. The Commission sought and received clarification on this point, including from the Department of Industry's Crown Lands and Water, that the project is consistent with Level 1 impact considerations of the policy. The Commission notes that conditions require the applicant to compensate the owner of any privately‑owned land for any adverse impact on their water supply. 1. As can be seen, the above passage notes that the PAC had sought and received advice concerning potential inconsistency with the NSW Aquifer Interference Policy (the policy). By necessary inference from what appears in the above extract, the PAC has accepted that the project is consistent with Level 1 impact considerations of the policy. 2. I earlier set out the observation of Preston CJ in Moorebank Recyclers Pty Ltd v Benedict Industries concerning the entitlement of a decision-maker to rely on advice from its officials. That position is equally applicable to my consideration of this ground. 3. There is no challenge by the Applicant to the PAC having sought advice on the NSW Aquifer Interference Policy and relied upon it. The final sentence of the extract from the element of the PAC's Determination Report, taken from folio 3836, leads me to condition 16, the adequacy of its response to the matters pressed being in contention. 4. It is, therefore, appropriate to turn to the elements contained in the four paragraphs of Condition 16 as earlier set out at [181]. The first three paragraphs of the condition set out the circumstances by which an owner of privately owned land can trigger, and be entitled to, the compensatory water supply measures dealt with in those three paragraphs. 5. In light of the PAC's consideration of, and response to, these water supply matters, it is facile to suggest that, as provided for in the final paragraph of condition 16, individual matters of the nature or scope of compensatory measures for any individual private landowner or the method of implementation of such measures should be prescribed at the level of particularity impliedly pressed by the Applicant. 6. First, the extent of drilling down to such a level of particularity is, itself, impermissible in circumstances such as these. 7. However, even if it was permissible to seek to do so, the response that will be necessary for assessing or implementing compensation for any adversely affected private landowner will, necessarily, depend on matters of the fine detail of the facts and circumstances of any claim and any dispute that might potentially arise with respect to it. Deferring such matters of fine detail to a dispute resolution mechanism to be undertaken by the Secretary is not unreasonable under the circumstances. Indeed, some might argue that the absence of such a mechanism would have demonstrated an error on behalf of the PAC on this issue. There is simply no Weal v Bathurst basis upon which this condition can be challenged. 8. Ground 9 is rejected. Ground 10 Introduction 1. The Applicant's Ground 10 was pleaded in the following terms: Ground 10 - invalidity of the Water Supply Condition 42 Schedule 4, Condition 16 of the consent (the Water Supply Condition) purports to require the operator of the mine to provide compensatory water or alternative compensation to any private landowner whose water supply is adversely and directly impacted as a result of the project. 43 The Water Supply Condition was not a condition which could be validly imposed because: a. properly construed, in the context of the EP&A Act as a whole, s 89E does not authorise the imposition of conditions requiring the payment of compensation for loss of water supplies as a means of mitigating the impacts of development; b. the condition is so unreasonable that no reasonable Consent authority would have imposed it, given that no "alternative compensation" could effectively compensate landholders dependent upon long-term water supplies for the loss of their livelihoods; c. the condition impermissibly purports to constrain the rights of landowners to compensation under the Mining Act 1992 and the Coal Mine Subsidence Compensation Act 2017. 44 The Water Supply Condition is not severable. The Water Supply Condition 1. As earlier noted, the Water Supply Condition is Condition 16 in Schedule 4 and is entitled "Compensatory Water Supply" and its terms were set out at [181]. The Applicant's position 1. First, it is to be noted that the Applicant did not press (43)(c) above, saying, in its written submissions at (146): The applicant does not press FAS [43](c), because it does not appear that this form of compensation would be covered by either the Mining Act or the Subsidence Act. 1. Second, as with Ground 9, the Applicant refers to relevant elements of its written submissions on Ground 8. 2. Although portion of the Minister's written submissions, at (122) (reproduced later in this decision), includes the assertion: The Applicant does not address any argument to Summons [43(b)] (that the condition is so unreasonable that no reasonable Consent authority would have imposed it), and so it is assumed that is also abandoned. this is clearly not correct. 1. In fact, the Applicant's reference to relevant elements of its written submissions on Ground 8 takes me to (129) to (136) of the Applicant's written submissions, on the basis that those paragraphs are to be read, mutatis mutandis, as applying to the condition sought to be impugned in this ground. Those paragraphs (footnotes omitted) were in the following terms: 129 In the alternative, the Flood Compensation Condition is invalid because it offends the second limb of the Newbury Test. 130 The general test for validity of planning conditions is derived from the decision of the UK Court of Appeal in Newbury District Council v Secretary of State for the Environment [1981] AAC 578 and was restated in the following terms by McHugh J in Western Australian Planning Commission v Temwood Holdings Ply Ltd (2004) 221 CLR 30 at [57]: A condition attached to a grant of planning permission will not be valid... unless: 1 The condition is for a planning purpose and not for any ulterior purpose. A planning purpose is one that implements a planning policy whose scope is ascertained by reference to the legislation that confers planning functions on the authority, not by reference to some preconceived general notion of what constitutes planning. 2 The condition reasonably and fairly relates to the development permitted. 3 The condition is not so unreasonable that no reasonable planning authority could have imposed it. 131 This test has been applied frequently both in this Court and the Court of Appeal to conditions imposed under s 80A of the EPA Act. There is no reason why this implied constraint should not also apply to the more general power at s 89E(1)(a). Indeed, the absence of express statutory guidance as to the kinds of conditions which may be imposed increases the need to adhere to the implied limits. 132 On the question of whether uncertainty may result in invalidity of a condition, Tobias AJA (Mason P and Hodgson JA Agreeing) said in Hurstville City Council v Renaldo Plus 3 Pty Ltd [2006] NSWCA 248 at [89]: It must be remembered that, as Basten JA observed in Kindimindi at 292 [55], and as noted by Mason P in Transport Action Group Against Motorways Inc at 628 [112], mere uncertainty may not give rise to invalidity. Whether or not uncertainty does give rise to invalidity depends upon a different question, namely, whether the condition alleged to be uncertain complies with the statutory limits imposed upon the power of the consent authority. 133 In the present case, the onerous nature of the condition, its capacity to operate arbitrarily upon both the proponent and affected landowners, and the lack of specificity about the terms of the required compensation or acquisitions, must lead to the conclusion that it does not fairly and reasonably relate to the subject development. Yes, there is a nexus between the development and the need for the acquisitions. However, the relationship between the development and the proposed acquisitions cannot be "fair and reasonable" where the condition fails to provide any criteria for how the measures are to be implemented. Who triggers the process of voluntary acquisition? In what time frame is the developer required to respond? How are disputes about the amount of compensation to be resolved? A condition which fails to resolve any of these questions cannot be fair and reasonable. 134 The respondents may say that the Secretary of the Department of Planning and Environment retains the power to ensure that arrangements for compensation and acquisition are fair and reasonable, since the flooding monitoring program must be approved by her. However, the PAC cannot delegate to the Secretary its obligations under s 89E(1)(a). The question is not whether the condition may produce a fair and reasonable result, but whether it is fair and reasonable, considered at the time that the condition is imposed. The Flood Compensation Condition does not fulfil this criterion. 135 An indication that s 89E does not confer a power to impose a completely open­ended compensation and acquisition condition may be found in the highly specific terms of the power to impose developer contribution conditions in Part 4 Division 6 of the EPA Act, as discussed above. While it is not suggested that the Flood Compensation Condition is governed by Part 4 Division 6 per se, there is a similar need for compensation conditions to be specific and certain. 136 The Flood Compensation Condition is not severable because it is clear from the passage cited at [102] above that the PAC relied upon the supposed right to compensation to alleviate otherwise unacceptable flooding impacts. Without the Flood Compensation Condition, the Consent would operate differently from the intention of the PAC because it would expose affected landowners to flooding risks without a right to compensation. The Applicant's reply position 1. I have earlier set out what Mr Leggat said his oral submissions in reply to Grounds 9 and 10 and it is not necessary to repeat them. The First Respondent's written submissions 1. The First Respondent's written submissions on Ground 10 were, in addition to the factual recitals, comparatively brief. It is, therefore, appropriate to reproduce them in full. They were in the following terms: 175 As set out above in respect of Ground 8, the power to impose conditions is broad and (consistently with the authorities) it is very difficult to establish legal unreasonableness. … 178 The ACA's criticism of this condition appears to be that (i) it requires the proponent to acquire water access licences so as to transfer them to third parties; and (ii) the PAC did not have power to impose a condition of that kind. 179 The first aspect of this criticism is unsound. The condition does not require WACJV to acquire water licences. Nor does the condition require WACJV to transfer any acquired water licences to third parties. Further, the condition in terms contemplates that an alternative long-term water supply may not be able to be secured, in which case WACJV is to provide alternative compensation. 180 It is unnecessary to decide whether the PAC would have had power to impose a condition requiring acquisition and transfer of water licences. That was not the condition imposed. 1. As a consequence, as with the Applicant's position, it is also necessary to turn to the First Respondent's submissions made on Ground 8 concerning the scope of the PAC's power to impose conditions. The relevant elements of the First Respondent's written submissions were in the following terms: 149. In assessing this ground, the starting point is the scope of the PAC's power to impose conditions. The source of that power was s 89E(1) of the Act, which stated: The Minister is to determine a development application in respect of State significant development by: (a) granting consent to the application with such modifications of the proposed development or on such conditions as the Minister may determine; or (b) refusing consent to the application. (emphasis added) 150. The power is not, in terms, confined. It is of course subject to such limits as arise from the subject matter, scope and purpose of the EP&A Act, together with the limits identified in Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at [57]. Those limits no doubt include that a legally unreasonable condition cannot be imposed. However, the authorities make it clear that the test for legal unreasonableness is stringent: see, eg, Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at [106]-[109] (Gageler J). 1. The remainder of the First Respondent's written submissions concerning Ground 8 were specific to the terms of the condition challenged in that ground and do not need to be repeated here. The First Respondent's oral submissions 1. Mr Lancaster said (Transcript, 13 November 2018, page 56, lines 16 to 42): To take a step back, what the applicant is trying to do is actively trying to invalidate the condition that provides for compensatory water supply on the basis that there's no power to impose a condition for that effect. We're talking, of course, of Condition 16 of p 3881 of the conditions of consent. Your Honour, it is impossible to accept, in our respectful submission, this condition as beyond power. It does not leave any matters to be determined in the future, in the sense in which the authorities from time to time identify important matters left undetermined. What Condition 16 does, on a fair reading of it - on any reading of it, that is reasonable - it stipulates a requirement that any effective land owner should have an equivalent quality and volume of water to be able to use, and that any loss of quality or volume should be restored within 24 hours of the water supply going down. It then provides that compensation is due if that can't be achieved in the long term, that is the quality and volume and timing requirements can't be achieved in the long term, such an amount to be determined by the Secretary. And of course, the extent of that conversation would be absolutely fact specific. It couldn't possibly be determined in advance because one wouldn't know what private land owner is affected. The character of the affectation of their water supply, and the only possible mechanism that would not involve idle speculation on the part of the PAC to deal with the compensation provision would have been precisely a condition term as is expressed there. The Secretary would need to consider and determine the matter, because the facts would be so specific. So, your Honour, there is no legal flaw with Condition 16, and ground 10 can be rejected. The Minister's position 1. The starting point for the Minister's submissions concerning Ground 10 refers back, via the submissions on Ground 8, to general submissions earlier made concerning the Minister's power to impose conditions, a power exercised in these proceedings on behalf of the Minister by the PAC. Those general elements of the Minister's written submissions were in the following terms (footnotes omitted): 33 Imposition of conditions: Where invalidity of a condition is alleged, the relevant question is whether the given condition falls outside the power to impose conditions that the power expressly or impliedly permits. The power of the PAC to impose conditions is found in s 89E(1)(a) of the EPA Act. It provides that the Minister can determine a development application in respect of State Significant Development by, relevantly, "granting consent to the appUcation with such modifications of the proposed development or on such conditions as the Minister may determine". On its face, that provision provides a broad power to impose conditions and the conditions that may be imposed pursuant to it are unfettered. 34 Given the function of Division 4.1 of Part 4, to facilitate large and complex development projects, to be decided as they are by the Minister or the PAC acting as delegate (rather than local authorities) it is unsurprising thats 89E(1)(a) is broad. Of course, Division 4.1 of Part 4 replaced the old Part 3A. And in this regard, the text of the power to impose conditions under s 89E in respect of State Significant Development is relevantly identical to the text of the equivalent power in old Part 3A in respect of major projects to which that Part applied. 35 Numerous authorities considered the scope of the condition making power in Part 3A, emphasising its breadth. Given the relevantly identical text- and the context by which Division 4.1 of Part 4 replaced Part 3A as the regime applicable to generally the same kinds of large­ scale, significant projects - the principles articulated in those cases are directly applicable to s 89E of the EPA Act. In this regard, the power to impose conditions has been recognised as wide and there is no warrant to read that power down by imposing a limitation that parameters of any adjustment to the project to meet an outcome or objectives specified, must also be specified. Retention of practical flexibility, leaving matters of detail for later determination, and delegation of supervision of some stage or aspect of the development, is recognised as being desirable and in accordance with the statutory scheme. Furthermore, the scale of the projects involved, which are often complex, expensive and multistage projects, make the retention of such flexibility appropriate and inevitable. In the context of such large projects, including mining projects, it has been held that conditions imposing an adaptive management approach (the preparation of plans of management) are an appropriate response to deal with the uncertainty and risk concerning the impacts .. . and the measures to mitigate the impacts and reflect the precautionary principle. 1. With respect to specific matters addressing Ground 10 alone, the Minister's written submissions said: 121 … Again, the relevant question is whether the given condition falls outside the power to impose conditions that the power in s 89E expressly or impliedly permits having regard to the scope of that power as addressed elsewhere in these submissions. 122 The bases on which the invalidity of the condition is alleged are articulated in Summons [43]. Three reasons are there alleged. The Applicant has abandoned Summons [43(c)]. The Applicant does not address any argument to Summons [43(b)] (that the condition is so unreasonable that no reasonable Consent authority would have imposed it), and so it is assumed that is also abandoned. That leaves Summons [43(a)], which alleges that "s 89E does not authorise the imposition of conditions requiring the payment of compensation for loss of water supplies as a means of mitigating the impacts of development". 123 As to the one matter which seems to be pressed, it raises similar issues to those addressed in paragraph 105 above. Nothing in the statutory scheme supports such a limited view of s 89E and it would be bizarre if a condition could not be included providing a compensation mechanism for the benefit of persons impacted by a development. Again, such a radical proposition must be rejected. 1. After reciting the terms of the Compensatory Water Supply condition (earlier set out at [181]), the Minister's written submissions continued, saying: 125 Plainly the primary obligation is to "provide a compensatory water supply" and which must be "equivalent, in quality and volume" and "within 24 hours" of identification. The allegation in Summons [43(a)] does not address the condition as a whole or its ordinary operation and so does not provide a basis for challenging the validity of the condition. 126 In its submissions, the Applicant attacks the condition on the basis that the PAC impermissibly exercised a power to impose "a condition requiring the proponent to acquire water access licences for the purpose of transferring them to third parties" (AS [145]). That is not the pleaded basis of the challenge. That aside, the condition imposes no such requirement. The Minister's oral submissions 1. Mr Shearer said (Transcript, 14 November 2018, page 106, lines 12 to 41): … It seems that (a) is the only one potentially live, but we've not really had a developed argument in relation to that either. What that subparagraph does is to take one tiny aspect of the condition out of its context. Your Honour's been taken to Condition 16, if I can go to it, document 43, p 3881. So, it needs to consider the condition as a whole. It begins with a notification obligation, then it provides an obligation to provide compensatory water, and then what that compensatory water supply must provide for is then dealt with in the next paragraph. There's a dispute resolution mechanism in the next paragraph, and then finally, "If the applicant...provide alternative compensation." Now, what is picked up here is just that last little bit. The primary obligation is to provide a compensatory water supply, and it's not a correct approach, in my submission, in seeking to impugn a comprehensive condition by isolating the last little fall back aspect of it and saying that the Court would then find that the condition is invalid. The ultimate question is whether the condition is outside the scope of the broad power for the reason that the applicant has alleged, and we say there is no basis to so conclude. There's an additional argument outside the scope of the summons that has been raised in the applicant's written submissions at para 145. It's different, so now we've moved from the condition being invalid as alleged in the summons because s 89E doesn't authorise the imposition of conditions requiring the payment of compensation as a means of mitigating. Now in 145, it is said that, "The Court should find 89E(1) does not include a power to require the proponent to provide compensatory water." So, it's a different focus here, and then there's reference to the Water Management Act and so on. None of that's pleaded of course, but in any event, it follows from what I've really already said about the breadth of the condition-making power, that it's not a basis to impugn the condition. Consideration 1. Before turning to the question of the power to impose condition 16, and any other matters relating to it, it is appropriate to address the unreasonableness proposition advanced by the Applicant as the first element of (43)(b) pleaded in Ground 10. Only after doing so is it appropriate to address the Applicant's proposition that no compensatory measure could be effective in the circumstances proposed to be addressed by the condition. 2. As I have earlier set out, the First Respondent addressed the issue but briefly, whilst the Minister did not address the question of "unreasonableness" in terms. 3. Although Ground 10 is pleaded (at the first portion of (42)(b)) in terms redolent of Wednesbury unreasonableness (Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223), the Applicant's submissions on Ground 8 only invoke the second of the Newbury tests (Newbury District Council v Secretary of State for the Environment [1981] AAC 578) on the issue of reasonableness - that is, reasonably relating to the proposed development and its impacts. I therefore do not address the question of Wednesbury unreasonableness. 4. For this purpose, I accept the validity of the propositions put in [130] and [131] of the Applicant's written submissions, that the Newbury tests, as adopted in Australia in the form discussed in Western Australian Planning Commission v Temwood Holdings Ply Ltd (2004) 221 CLR 30; [2004] HCA 63, apply equally to conditions imposed pursuant to s 89E(1)(a) of the EP&A Act when this is done by the PAC as the Minister's delegate. 5. Also for the purposes of this consideration, I assume (only for the purposes of determining Ground 10) that that which is set out in (132) of the Applicant's written submissions is correct and that the element of the decision in Hurstville City Council v Renaldo Plus 3 Pty Ltd [2006] NSWCA 248, extracted in the submissions, is to be taken to apply to Condition 16. 6. The remainder of the elements dealing with unreasonableness, in (133) and the first sentence in (134), are particular to the flooding condition the subject of Ground 8. Of the remaining matters set out, from that point in (134) to the end of (136) of the Applicant's submissions concerning Ground 8, I have extracted what I consider to be the relevant elements as they are applicable to condition 16. These may be restated as: The question is not whether the condition may produce a fair and reasonable result, but whether it is fair and reasonable, considered at the time the condition is imposed. The Compensatory Water Supply condition does not fulfil this criterion. … There is a need for compensation conditions to be specific and certain. 1. I am unable to discern any rational basis as to how the terms of Condition 16 might offend the second of the Newbury tests. The Applicant points to no specific aspects (separate to those dealt with in Ground 9) as to how this element of Ground 10 might be established. 2. At (136), the Applicant's submissions dealt with severability, a question which only arises if I was to have found that condition 16 was invalid. As I have not done so for the reasons that follow, whether condition 16 is severable does not arise. 3. Next, to start my substantive consideration of Ground 10, it is appropriate to hark back to a former statutory regime that applied, amongst other things, to projects such as those that are now classified as State Significant Development. That regime was in (the now repealed) Pt 3A of the EP&A Act. The relevant power for the granting of approvals, and, particularly the imposition of conditions of consent to attach to such approvals, was contained in the then s 75J of the Act. The condition-making power was contained in s 75J(4), a provision in the following terms: (4) A project may be approved under this Part with such modifications of the project or on such conditions as the Minister may determine. 1. The provision engaged in these proceedings concerning the Minister's powers for the determination of State Significant Development is, relevantly, contained in s 89E(1)(a) of the EP&A Act as earlier set out. The words investing the Minister with power are, as to their operative effect, identical. The specific portion of the repealed provision and the now applicable provision concerning the ability of the Minister to impose conditions are identical. 2. For these purposes, relevant past decisions that have addressed the extent of, and test to be applied concerning, conditions, imposed pursuant to s 75J(4) of the EP&A Act concerning Pt 3A projects, are equally relevant to testing such conditions imposed pursuant to s 89E(1)(a) in the determination of State Significant Development proposals such as the one here being considered. In Ulan Coal Mines Limited v Minister for Planning and Moolarben Coal Mines Pty Limited (2008) 160 LGERA 20; [2008] NSWLEC 185 (Ulan), Preston CJ dealt with the validity of conditions imposed pursuant to the then s 75J at [50] and [51] (citations omitted): 50 Rather, a condition will only be invalid, by lacking certainty or finality, if it falls outside the class of conditions which the statute expressly or impliedly permits. Where a condition does fall outside what the statute permits, the purported approval is not an approval under the statute at all (assuming the condition is not severable). 51 The relevant question in this case, therefore, is whether Condition 29 falls outside the power to impose conditions that s 75J of the Act expressly or impliedly permits. This involves construction of the section and its application to the circumstances of this particular Project. 1. In Rivers SOS Inc v Minister for Planning (2010) 178 LGERA 347; [2009] NSWLEC 213, Preston CJ was again faced with the question of whether a particular condition in that Pt 3A project was valid or not. In [134], his Honour restated the test he had set out in [50] of Ulan and then, having undertaken that assessment, he applied the test and concluded: 134 Having regard to the condition, its relationship to other conditions of the approval and its likely operation, as well as to the nature and extent of the Project, Condition 6 of Schedule 6 cannot be said to be outside the power under s 75J(4) of the Act to impose conditions. 1. It is clear that condition 16, in terms, responds in that fashion to the matters in the PAC's Determination Report and materials considered by the PAC on this topic. 2. Finally, in the Applicant's written submissions in reply, at (44), the Applicant responds to that element of the First Respondent's written submissions concerning the submission that the proponent would need to acquire and transfer water licences. These written submissions in reply, on this point, were in the following terms: The FROS at [179] contended that the water supply condition does not require the transfer of water licences. This is not a reasonable construction of the condition. Where the condition is triggered, the obligation to provide compensatory water supply is both express and mandatory. The compensatory water supply must be "long-term" and "equivalent in quality and volume, to the loss attributed to the development". There is no other way, practically speaking, under the Water Management Act 2000 to provide a reliable long-term water supply or private landowner on a regulated river, them by the purchase and transfer of water licences. 1. In the terms submitted, what is questioned is a finding of fact, implicit in the PAC's consideration and adoption of a condition based on its assessment of the facts and circumstances arising from the material before it. This element of the Applicant's submission involves an impermissible canvassing of the merits of the condition, a position not permitted in proceedings of this type. Although Wednesbury "unreasonableness" was pleaded by implication in (43)(b), the Applicant made no submissions in support of that proposition and that complaint must also fail. 2. Ground 10 is rejected. Orders 1. Having been unsuccessful in establishing any of the grounds (as finally pressed) founding the Applicant's challenge of the PAC's determination, the orders of the Court are that: 1. The summons is dismissed; 2. The hearing listed for 4 April 2019 is vacated; and 3. Costs are reserved. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 25 March 2019